U.S. markets close in 6 hours 18 minutes
  • S&P 500

    3,611.72
    +26.10 (+0.73%)
     
  • Dow 30

    29,006.36
    +280.85 (+0.98%)
     
  • Nasdaq

    10,599.43
    +23.82 (+0.23%)
     
  • Russell 2000

    1,664.72
    -10.21 (-0.61%)
     
  • Crude Oil

    84.15
    +4.66 (+5.86%)
     
  • Gold

    1,678.50
    +6.50 (+0.39%)
     
  • Silver

    20.14
    +1.10 (+5.78%)
     
  • EUR/USD

    0.9762
    -0.0039 (-0.40%)
     
  • 10-Yr Bond

    3.6800
    -0.1240 (-3.26%)
     
  • GBP/USD

    1.1204
    +0.0038 (+0.34%)
     
  • USD/JPY

    144.9180
    +0.1890 (+0.13%)
     
  • BTC-USD

    19,206.42
    +20.34 (+0.11%)
     
  • CMC Crypto 200

    437.24
    +1.89 (+0.43%)
     
  • FTSE 100

    6,881.75
    -12.06 (-0.17%)
     
  • Nikkei 225

    26,215.79
    +278.58 (+1.07%)
     

Get ready to pay more for gas by Memorial Day

AAA predicts that the price of gas will increase by Memorial Day. (Thinkstock)

We’ve got some good news and some bad news.

Bad news first: Gas prices are on the rise. During March, gas prices increased for 21 consecutive days, starting at $1.86 a gallon and reaching $2.04 by March 28. And it doesn’t look like the climb will stop there; AAA predicts that the average price of gas could rise by 25 cents a gallon by Memorial Day.

With all of the recent headlines about the oversupply of oil in the global market, why are gas prices going up?

One reason consumers are expected to pay more at the pump is because many refineries have until June 1 to start selling a special summer-blend gasoline. This gas is mandated by the EPA and is less likely to contribute to air pollution during warmer temperatures. In response, refineries are expected to lower their supply of regular gas at a time when more drivers hit the road to enjoy the warmer weather. The result is higher prices.

But before you get pump paranoia, there are some silver linings. The good news is that at the beginning of April, gas prices were at the same level they were in 2009. Sure, gas is a few cents more expensive than it was in January, but at the current national average of $2.06 a gallon, drivers are saving 34 cents per gallon compared to April 2015.

A look at how gas prices have changed from 2013 to 2016. (Photo: AAA)
A look at how gas prices have changed from 2013 to 2016. (Photo: AAA)

Currently, California has the most expensive gas at $2.79 a gallon. Hawaii ($2.60), Nevada ($2.45), Washington ($2.45), and Alaska ($2.27) round out the top five.

On the other end of the spectrum, a handful of states have gas below $2, with Oklahoma ($1.82) and South Carolina ($1.85) boasting the cheapest gas in the nation.

In 2015, the average driver saved $565 on gas compared to 2014, and the AAA says that  Americans paid the cheapest quarterly gas prices since 2004 during the first three months of this year.

So if you’re planning a trip this spring or over Memorial Day weekend, you can expect higher gas prices, but it will be nowhere near what we’ve seen in previous years.

To set a road trip budget, download an app like GasBuddy that will help you monitor gas prices around the U.S. The app will identify stations with the cheapest gas, and it even has a trip cost calculator so you can predict how much gas will cost for your entire trip.

Do you have a question about travel credit cards? Email us at yfmoneymailbag@yahoo.com.