Staycations? Not this holiday — gas prices are down

More of us are apt to hit the road, thanks to an atypical oil market

By Erin Ailworth
Globe Staff / May 25, 2011

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In the last two weeks, Faissal Daaboul, who owns a service station in Swampscott, has cut his price per gallon nearly 20 cents to just under $3.70 for regular. If commodity markets continue to cooperate, he’s hoping to trim another dime by Memorial Day weekend.

“People, they are going to travel because the price is dropping,’’ Daaboul said. “I want to make something for the holiday.’’

Falling prices and the start of the summer driving season don’t usually go together. But motorists heading for the beach, mountains, or backyard barbecues are likely to benefit from a confluence of factors that has pushed down the cost of crude oil in the commodity markets and translated it into lower gas prices.

Those factors include a struggling global economy, which typically means less demand; a stronger dollar, which lowers the cost of imported oil; and fewer concerns that recent events in the Middle East will lead to major disruptions in oil supplies.

Even with crude rising yesterday, closing just below $100 a barrel in New York, oil prices have fallen more than $10 a barrel since the beginning of the month. Average gas prices in Massachusetts have slipped, too, dropping 5 cents this week to just under $3.89 for a gallon of regular, according to AAA of Southern New England.

Whether prices will continue to drop is anyone’s guess, given uncertainty about the global economy and continued unrest in the Middle East. Gasoline prices are notoriously difficult to predict. Some analysts, for example, had predicted that retail prices would be on the way to $5 a gallon by now.

But for the time being, prices are lower — and that should encourage at least a small bump in consumer spending.

“When the price of gasoline falls, people feel better,’’ said Chris G. Christopher Jr., a senior economist with Lexington forecasting firm IHS Global Insight. “Maybe they’ll spend a bit more or have a nicer vacation because of it.’’

Memorial Day, the start of the summer driving season, often kicks off with a steady increase in gas prices as people take advantage of nice weather and vacation time to travel. Consumers were hit particularly hard in 2008, when fuel costs in Massachusetts took off around Memorial Day on their way to historic highs that summer above $4 a gallon. Prices also rose around Memorial Day in 2009, when many families were struggling with the economic downturn.

As a result, many opted for “staycations’’ near home. But this year is different. AAA says it expects 34.9 million Americans to travel 50 miles or more from home this weekend, a slight increase over last year.

Mary Maguire, a spokeswoman with AAA Southern New England, said travelers are ready to hit the road in part because gas prices have not topped $4 a gallon in Massachusetts.

“We dodged that bullet, which I think is a positive element for travel,’’ she said.

It’s also a positive development for gas stations, which lose customers when fuel prices climb. More people on the road means more business at the gas pumps. And as station owners compete, they will come under pressure to keep prices low.

“I think retailers are going to be vying to get people into their gas stations,’’ said Phil Flynn, an oil analyst with PFGBest, a commodity futures broker in Chicago. “It’s going to be very competitive.’’

Daaboul said he is hoping to entice customers with a pricing special: $3.59 per gallon of regular unleaded, 30 cents lower than the current state average, according to AAA Southern New England.

“Every customer walking in here, they say they are happy to see the prices down,’’ Daaboul said. “I need more people to be happy.’’

And that will be a boon for drivers like Melissa Manganello of Braintree, who said she has noticed a two-cent drop in price at her local gas station.

“I was happy to see it go down,’’ Manganello said. She still had not nailed down her weekend plans with her husband. But, she added, “Whatever we do will involve driving.’’

Erin Ailworth can be reached at

Gas-saving tips

Check your air filter: A clean air filter can improve gas mileage by as much as 10 percent, saving the equivalent of 39 cents a gallon.*

Straighten out: Poor wheel alignment forces your engine to work harder. Fixing improper alignment could save the equivalent of 39 cents per gallon.

Tune up: A properly tuned engine can improve mileage by 4 percent, saving 15 cents a gallon.

Pump ’em up: Properly inflating tires is like knocking 11 cents off a gallon of gas.

Check your cap: Fixing or replacing a faulty gas cap is like saving 3 cents per gallon.

Lose weight: For every 100 pounds you unload, you’re saving the equivalent of 6 cents per gallon.

Don’t speed: Slowing to 65 from 70 on the highway saves the equivalent of 27 cents a gallon.

Drive smoother: The more smoothly you accelerate and decelerate, the better your gas mileage.

Foot off: Don’t drive with a foot on the brake, and save the equivalent of $1.35 per gallon.

Don’t idle: For every two minutes that you don’t idle, you’ll save the equivalent of nearly 1 cent per gallon.

*Savings estimates are based on gas at $3.85 per gallon.

SOURCE: Consumer Federation of America, a group of nearly 300 nonprofit organizations