This Fourth of July, a record number of people are honoring the country with one of its most popular pastimes — the Great American Road Trip — despite rising gas prices.
Gas prices are hovering near their highest historical levels even after retreating from the sharp rise that followed the war with Iran.
The national average for regular gasoline has fallen from a peak in June above $4.56 a gallon as crude oil prices ease following the peak of the conflict and energy shipments resume across the Persian Gulf.
Even so, drivers They still pay a national average of $3.84 per gallon on average – Nearly a dollar more than before the war, enough to make this the third most expensive Independence Day period at stations ever, behind only 2022 and 2008.
The average price of gas in New York was $4.07 as of Friday.
pinch It doesn’t keep Americans out of the way.
AAA expects A A record 61.4 million people travel by car During the weekend, it is the second busiest driving time of the year after Thanksgiving.
Instead of canceling vacations, many families are opting for shorter vacations, destinations closer to home and fewer discretionary purchases like souvenirs to offset higher fuel bills, according to AAA.
The high cost of filling the reservoir could become a political headache for President Donald Trump and Republicans in Congress as the November midterm elections approach.
A Gallup poll conducted during the first two weeks of June found that two-thirds of Americans say rising gasoline prices are causing financial stress, while nearly half reported changing their summer travel plans because of fuel costs.
Consumer confidence improved modestly in June as gasoline prices fell, easing some concerns about the economy.
Trump has repeatedly predicted that fuel prices will “drop like a rock” after the conflict in the Middle East ends and accused retailers of failing to deliver savings to consumers quickly enough.
“Gasoline dealers should reduce their prices immediately!” Trump wrote in a social media post dated June 29.
“If retailers don’t do this, there will be big problems ahead. Start targeting a figure of around $2.50 per gallon.”
Economists say drivers should not expect prices to return to pre-war levels any time soon.
Gas stations are still selling fuel they bought when wholesale prices were much higher, creating a delay before lower oil prices reach consumers, said Sung Won Soon, a professor of finance and economics at Loyola Marymount University and chief economist at SS Economics.
He told the newspaper: “Until this gas is sold and exhausted, they are reluctant to reduce the price.” “There’s a little bit of a time delay.”
He added that even if fighting in the Middle East does not resume, motorists may wait up to six months before prices stabilize.
“I doubt we will see the price of gasoline return to what it was before the war, at least for a while,” Sun said.
Continued disruptions to Gulf shipping routes, rising tanker insurance costs, and unusually low global fuel inventories are also likely to keep prices high as supplies gradually rebuild, according to Son.
Higher gasoline prices also affect lower-income Americans more, he said.
Unlike wealthier households who have benefited from rising stock prices and home values, low-income consumers have little financial support to absorb higher fuel and grocery bills, Son explained.
“When they see gasoline prices rising, they don’t feel comfortable. Their confidence drops. They become more cautious about spending,” he said.