This Memorial Day weekend marks the unofficial start of summer and the official beginning of the “summer driving season.” Traditionally that means consumers need to open their wallets wider as gas prices climb. It’s usually simply a matter of supply and demand. More people driving to the beach or the lake or the mountains for vacation means more demand for fuel, so prices climb accordingly.
On top of that, summer fuel is actually different from winter fuel and it costs more to produce. As a result of increased gasoline consumption, the Environmental Protection Agency requires cleaner burning gas in summer to help reduce pollution. That costs the Exxons (XOM) and the Shells (RDS-A) of the world more money to produce gasoline and guess who's left paying the difference...
This summer however, the gas tank in the family truckster may not cost so much to fill. Patrick DeHaan, senior petroleum analyst at GasBuddy.com, says, “All of it really has to do with refinery maintenance that takes place during the late winter, early spring. That causes prices to rise ... and then as we start the month of June, all of that is really behind us."
So how low can prices go? “The national average [currently at about $3.65 a gallon] may hold steady for the next week or two,” DeHaan says, “before we start to see that dive take place. And we’re hoping that by mid summer the national average could be as low as the $3.40’s.”
As an added bonus DeHaan notes that there don’t seem to be many, if any, hot spots in the country where gas prices are oddly higher. He chalks this up to a refinery maintenance season that has been pretty free of hurdles.
Of course, there are many variables that could change the current outlook. Chief among them is another sign of the summer -- hurricanes. An active season could cause temporary closings of oil platforms in the Gulf of Mexico and refineries along the Gulf Coast. If that happens, what was supposed to be a cheaper summer could go the other way, and fast.