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Fluctuating Gas Prices Can’t Dent Americans’ Love Affair With Their Cars

By Daniel J. Graeber | Tue, 22 April 2014 13:20 | 0

The national average price for a gallon of unleaded regular gasoline may be 15 cents higher than this time last year, but the fact that gasoline prices in general are trending lower has kept American drivers from reducing their time on the road, according to the American Automobile Association.

AAA reported that the national average price for a gallon of regular unleaded gasoline right now is $3.67, which is a nickel higher than last week’s price and 15 cents higher year-on-year.

In general, however, gasoline prices are down compared with previous years. The average price at this time in 2012 was $3.92 per gallon.

Michael Green, a spokesman for AAA, told Oilprice.com that fewer U.S. drivers are letting fluctuations in gasoline prices affect their driving habits.

Green said gasoline demand increased in 2013 by 1.1 percent, the highest annual increase in more than five years. This translated to an estimated 18.1 billion miles traveled on American roadways last year.

"One possible explanation is that Americans are less concerned about gas [prices], given that prices generally have been less expensive than in previous years," he said. "If this is true, it is possible we might yet again see increased demand [for gas] even with improvements in fuel economy this year."

A report from the University of Michigan's Transportation Research Institute found the fuel economy for model year 2013 was 24.7 mpg, an improvement of 5 percent since 2012.

But the higher price tag of fuel-efficient vehicles puts them out of reach of most American drivers, Green said.

In March, AAA found that about half of the people it questioned said they were changing their driving habits or lifestyle in general in an effort to curb gasoline use.

Related Article: U.S. Gas Prices Rise, but not because of Global Factors

That’s down from a similar AAA survey from one year ago, which found that more than 60 percent of U.S. drivers were trying to use less gasoline, even though the national average price had gone down year-on-year.

In general, most drivers in the United States say $3.50 per gallon is too much to pay for gasoline, according to AAA. Attitudes vary by region, however; someone in California who is used to paying $4 per gallon may feel relief if the price drops to $3.50, which someone in South Carolina may see as extreme.

Green said there's no single price point that triggers a change in consumer behavior. And while most drivers are willing to make changes in things like how often they use the car to run errands or take trips, when it comes to work commutes, Green said fewer than 50 percent of people say they would be willing to carpool, and only 15 percent would consider leaving their cars behind in favor of public transportation.

"It is difficult for most drivers to significantly change their fuel consumption," he said. "Most people use their cars to get to work, and in many parts of the country there are limited alternatives to driving."

By Daniel Graeber of OIlprice.com

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