In Run-Up to Fourth of July, Fuel Prices Highest Since 2008 Surge
Posted at 9:06 a.m. on July 1, 2014
Gasoline prices are on average about 20 cents higher than a year ago at this time and higher than they have been in six years, according to data released by the Department of Energy’s Energy Information Administration.
The EIA said the average national price of regular gasoline was $3.70 on Monday.
For the major metro areas EIA surveyed, the highest gasoline prices on Monday were in Los Angeles at $4.19 and the lowest in Houston at $3.46.
Comparing the price data for the Monday before the July Fourth weekend going back 10 years, the pre-July Fourth gasoline peak was reached in 2008 when gasoline averaged $4.09, according to EIA data.
The surge in gasoline prices in the spring of 2008 prompted that year’s Republican presidential candidate, Sen. John McCain, to call for a gasoline tax “holiday,” suspending the 18.4 cent federal gas tax and 24.4 cent diesel tax from Memorial Day to Labor Day.
McCain framed it as fairness issue: “The people who drive the furthest are the lowest income Americans. It is incredibly regressive. Where’s the fairness there?”
The last time the price at the pump for regular gasoline was under $2 a gallon in the immediate run-up to Fourth of July holiday was ten years ago in the summer of 2004.
But these are nominal prices, not adjusted for inflation. If you adjust for inflation, $2 in 2004 had the purchasing power of $2.50 today.
In a separate survey, the AAA concurred with the EIA that pre-July Fourth gasoline prices are the highest since the summer of 2008, which the group said was “primarily because Iraqi violence has increased global petroleum costs.”
“Most drivers are paying about 15-20 cents more per gallon than expected heading into the busy Independence Day weekend due to market fear about Iraq,” said Avery Ash, an AAA spokesman. “It is frustrating that events overseas will make it more expensive to celebrate Fourth of July here at home.”
According to AAA’s survey, Monday’s national average price of gas is $3.68 per gallon.
AAA found that the five states with the highest average prices are Hawaii ($4.34), Alaska ($4.22), California ($4.13), Washington ($4.00) and Oregon ($3.98).
The states with the lowest average prices are South Carolina ($3.39), Alabama ($3.42), Mississippi ($3.45), Tennessee ($3.46) and Arkansas ($3.48).
This disparity partly reflect higher state gasoline taxes in the West Coast states than in the southern states.
If you’re buying gasoline this holiday weekend in Maryland, you will be paying higher gasoline taxes, due to a 3.5 cent per gallon increase signed by Gov. Martin O’Malley, a Democrat.
So too in New Hampshire which increased its gasoline tax by 4 cents, effective today, bring it to 22.2 cents per gallon.
“A modern and solid transportation infrastructure is essential to the success of New Hampshire’s people and businesses,” said Gov. Maggie Hassan, a Democrat, when she signed the tax increase into law in May.