Great news for us RVers out there. Gas prices are predicted to fall this year. I guess we will have to wait to see if this actually happens or not. But I’m looking forward to getting out to my favorite campgrounds…. Safe Travels and Happy RVing!
NEW YORK (AP) — At least gasoline should cost you less in 2013.
Hamburger, health care and taxes are all set to take a bigger bite out of the family budget this year. But drivers’ annual gas bills are expected to drop for the first time in four years.
Forecasters say ample oil supplies and weak U.S. demand will keep a lid on prices. The lows will be lower and the highs won’t be so high compared with a year ago. The average price of a gallon of gasoline will fall 5 percent to $3.44, according to the Energy Department.
“Everything is lining up to lead to softer prices this year,” said Tom Kloza, chief oil analyst at the Oil Price Information Service.
That would still be the third-highest average price ever. But a discount of 19 cents per gallon from 2012 would save the typical household $205 this year and free up $25 billion that could go instead to restaurants, malls or movie theaters — the kind of consumer spending that accounts for 70 percent of American economic activity.
“It’s a little benefit to the economy, and it’s a little more reason the Fed doesn’t have to worry about inflation,” said James Hamilton, an economist at the University of California at San Diego who studies energy prices.
Forecasters caution that they can’t predict other factors like Middle East tensions, refinery problems or hurricanes along the U.S. Gulf Coast — in other words, the same events that caused gasoline prices to spike in 2011 and 2012. Any or all of those troubles could crop up again in 2013 and push pump prices above last year’s record average of $3.63 a gallon.
The government expected gas to average about $3 during 2011. Then came the Arab Spring, which included the shutdown of Libya’s oil production. Oil prices shot up, and gasoline averaged $3.53 for the year. The government’s forecast for last year also turned out to be too low, by 18 cents per gallon.
And, Hamilton said, consumer spending might not see a boost from lower gasoline prices because most Americans will be paying higher taxes. The expiration of last year’s payroll tax reduction will cost an extra $579 for households making $40,000 to $50,000 in 2013, according to the Tax Policy Center, a non-partisan Washington research group.
But after average gas prices rose in 2010, 2011, and 2012, a little relief will be welcome in 2013.
Gas prices set records each of the past two years for a few reasons. Global demand has risen as the developing economies of Asia, Latin America and the Middle East burn more gasoline, diesel and jet fuel. At the same time, unrest in the Middle East has sparked fears of widespread supply disruptions in a region that produces a quarter of the world’s oil. That makes traders willing to pay higher prices up front for oil as a way to protect against possible dramatic price spikes in the future.
In the U.S. last year, several refineries and pipelines had problems that reduced gasoline supplies, especially on the West Coast and in the Midwest, helping to push pump prices even higher.
This year, global oil demand is expected to rise slightly again, but increased production, especially in the U.S., should keep supplies ample. The U.S. Energy Information Administration said this week that American production will grow next year by 900,000 barrels per day, the nation’s biggest single-year increase ever. By 2014, U.S. production will reach its highest level since 1988.
At the same time, U.S. gasoline consumption is back down to 2002 levels because of more fuel-efficient cars and the tepid economy. It isn’t expected to rise this year or next, according to the Energy Department.
That means the U.S. will need to import less oil, which will increase global supplies and help tamp down prices somewhat.
The current average retail price of gasoline is $3.31 per gallon, 6 cents lower than last year, according to AAA, OPIS and Wright Express. AAA predicts gas won’t surpass $3.80 a gallon this year.
The peak last year was $3.94, reached in April. The auto club also says average pump prices could drop as low as $3.20, a level that the country hasn’t seen since February 2011.
Tom Kloza of OPIS expects price differences between regions of the country will remain large, and local prices could be volatile as supplies build and dwindle. In Utah, drivers are paying $2.88 per gallon on average, while in New York drivers are paying $3.75. Just in the last four months, gasoline supplies on the West Coast fell to their lowest level in a generation, then rose to where they are now, their highest level in a generation.
AAA forecasts the national average will peak between $3.60 and $3.80 in the spring, then drop to between $3.20 and $3.40 by mid-summer. It will rise again during the hurricane season along the Gulf Coast, the nation’s oil-refining hub, before moving lower toward the end of the year.
It’s that up-and-down movement that will dictate drivers’ moods. Drivers tend to remember what they paid for their last fill-up — not that they may have paid a little less a year ago, Hamilton said.
“People have a short reference point,” he said.
Jonathan Fahey can be reached at http://twitter.com/JonathanFahey .
The sky is the limit when it comes to amenities you’ll find in motor-homes, travel trailers and fifth wheels these days. Every thing from leather couches, washers and dryers, and even heated tile flooring, but with those things comes a big price tag, especially on a motorized RV. Then when you get it home there’s the cost to fill up the gas tank on the RV, which can run as much as $300 or less for a tow vehicle. However this not stopping campers from heading out to their favorite spots.
“We go with a group of 15 other couples and we have the schedule all planned out for the third weekend each month, we go somewhere for our weekend camp-out,” said Louise Frank, an RV owner.
According to the Recreation Vehicle Industry Association RV sales in 2011 were up 4.1 percent nationwide, and people at the QCAA RV Expo say the threat of high gas prices won’t stop them from buying and using their campers. “It’s just a budget thing, if you’re going to make the trip it’s just like any other vacation, you set the money aside and you go,” said Chad Misfeldt, an RV shopper. “It’s something that you work for because that’s something you enjoy to do.”
The cost has however changed some aspects of how RV owners travel.”We just don’t use it to travel very much, we keep it at the lake and travel there in the summer.” Frank says they also budget differently during trips, like camping during the week when rates are cheaper, or cutting back on other expenses. “We still love to do our camping so we cut others ways, we may not go out to eat as much while we’re home,” said Frank. “Even when we’re camping we go out for lunch instead of supper.”
Many are parking their campers on permanent campgrounds sites, or are opting to purchase a smaller lighter weight. Going smaller and lighter weight pays for itself in fuel economy. Although the majority of RV owners know that by going small, you are going to have to sacrifice room. Whether that is storage room, living space or sleeping space. The majority of RVs being build nowadays are pushing the envelope in design and comfort. On the upside of the fuel situation, many automotive manufacturers are giving the consumer more towing payload with greater emphasis on fuel mileage.
The vast majority of RV consumers view their camping trips as a time to bond with the family and say eight miles to the gallon is a small price to pay for building memories that will last a lifetime.