"Kicking Into High Gear" - A Record 42 Million Drivers Will Hit America's Highways On July 4th Weekend
Despite emerging signs of gasoline demand destruction, an exception could be made this weekend as a new forecast indicates that a record number of drivers are expected to hit America's highways this Independence Day weekend despite minimal relief at the pump.
"The biggest surprise – car travel – will set a new record despite historically high gas prices with 42 million people hitting the road" this weekend, auto club AAA said in a new report. This means the number of drivers on the road would exceed 2019 (pre-COVID) by half a million.
"The volume of travelers we expect to see over Independence Day is a definite sign that summer travel is kicking into high gear," said Paula Twidale, senior vice president, AAA Travel.
Twidale added: "Earlier this year, we started seeing the demand for travel increase and it's not tapering off. People are ready for a break and despite things costing more, they are finding ways to still take that much-needed vacation."
The emergence of gasoline demand destruction and threats of recession has brought down the national average price of regular gas (octane 87) by about 3% from the record high of $5.016 a gallon to $4.857 in the last few weeks. That's a 16-cent saving per gallon -- factor in the average fuel tank size for a US automobile is about 14 gallons -- drivers will save a paltry $2.24 every time they fill up.
We're surprised the White House didn't tout these savings ahead of the holiday weekend as they did last year.
Dear @WhiteHouse we are waiting to ketchup on how it's looking for 2022 https://t.co/GDF1z9qVJY— zerohedge (@zerohedge) June 30, 2022
The crux of the problem and why gas, diesel, and jet fuel prices remain elevated is US refining capacity is a significant bottleneck as no new capacity is coming online amid robust demand.