Memorial Day driving by the numbers
Memorial Day weekend marks the beginning of "summer driving season." Families pack up their cars or minivans to visit relatives and friends. Or they hop on America's highways to enjoy our national parks, forests, beaches, and cities. The car trip is as American as apple pie or baseball.
This summer, however, Americans' car trips are going to be much more expensive. Gasoline prices are nearly a dollar per gallon more than last year—a one-third leap. These higher prices are directly related to higher oil prices, which are $23 per barrel more than one year ago. This is a 33 percent hike.
Adding insult to injury, a significant portion of the gasoline price increase is due to speculators exploiting fears about the impact of instability in the Persian Gulf on the future price of oil. Reliable evidence indicates that speculators prey on these fears by bidding up oil prices, which ultimately hit $114 per barrel a month ago.
Oil prices have declined from this peak, thankfully. But gasoline prices remain relatively high at a nationwide average of $3.90 per gallon, with higher prices in California, the East Coast, and major cities.
These prices mean that Memorial Day weekend travelers will spend an average of $23 more at the pump. They'll have fewer dollars for boat rentals, picnics, baseball games, or other vacation activities. And these prices are likely to remain high throughout the summer, according to the Energy Information Administration.
While these families pay more, Big Oil earns more profits and collects tax dollars, too. That's the fiscal equivalent of a giant rainstorm on your Memorial Day BBQ.
Here is a by-the-numbers examination of what speculators and Big Oil will cost us this weekend.
An expensive holiday weekend ahead
Speculators drive up oil prices
House budget helps speculators
Potential future oil savings from more fuel-efficient cars
This article was published by the Center for American Progress.
Daniel J. Weiss is a Senior Fellow and the Director of Climate Strategy at American Progress, where he leads the Center’s clean energy and climate advocacy campaign.