If you’ve been putting off a trip, now may be the time to finally hit the road. Gas prices this summer are at their lowest levels since the aftermath of the financial crisis. This season’s average price should be just $2.67 per gallon, nearly a full $1 lower than last summer’s. The EIA expects U.S. drivers will take advantage:
Travel and gasoline consumption are expected to be higher this summer compared to levels in 2014. Motor gasoline consumption is expected to increase by 194,000 barrels per day (b/d), up 2.1% from last summer, reflecting higher real disposable income, substantially lower retail motor gasoline prices, and higher employment and consumer confidence.
Driving this summer (as measured by vehicle miles traveled) is expected to be 2.2% higher than last summer, the largest year-over-year summer increase in 11 years. The increase in highway travel is not just a response to the drop in gasoline prices. Real disposable income is projected to be 3.6% higher than last summer, the largest year-over-year increase in nine years. Nonfarm employment is projected to rise 2.1%, the largest such increase since 2000.
Shale deserves much of the credit for the cheapest summer gas prices we’ve seen in years. New American oil supplies have contributed to a global oversupply and the resulting price plunge, which is now in turn being reflected in lower totals at the pump.
While most Americans will welcome the opportunity to fill up their tanks for less, greens won’t be happy to see our citizenry hitting the roads in greater numbers. Neither will they cheer surging SUV sales, another ripple effect of lower oil prices. For them, though, there’s a lesson here: economic motivations are much stronger than appeals to green ideals. Americans will be driving more this summer not out of some deep hatred for Gaia, but rather because it’s recently become a more cost-effective way for people to improve the quality of their lives.