Consumers Skeptical of Return of $2-a-Gallon Gas
ALEXANDRIA, Va. — Despite falling gas prices, consumers are not sold on seeing them dip to $2 a gallon this year.
According to the latest Consumer Fuels Survey results released by NACS, the Association for Convenience & Fuel Retailing, consumer optimism is rising as gas prices fall from their seasonal high. However, that optimism does not carry over to the return of gas prices below $2.
Nearly two in five Americans say gas prices are lower than they were this time last month, but there are noticeable regional variations. Two in five drivers in the Northeast (43 percent) and Midwest (44 percent) reported lower prices, more than double the percentage reporting lower prices in the West (21 percent).
Nationwide, the median reported gas price is $2.64, a 15-cent drop from last month's median, according to the association.
The decrease in gas prices has led to increased economic optimism. One in two consumers are optimistic about the economy, a two-percentage point increase from last month. In addition, 77 percent of consumers say gas prices affect their feelings about the economy.
A combination of vacations and lower gas prices will lead many Americans to step up their driving in August. One in three say they will drive more over the coming 30 days, while only 8 percent say they will drive less, this month's survey found.
Many consumers think the pain at the pump will continue to ease. Twenty-five percent of consumers are expecting gas prices to decrease over the next 30 days — up from just 10 percent who thought so last month.
However, only one in five consumers (20 percent) think gas prices are likely to fall under $2 per gallon in the next few months. A majority of U.S. fuel consumers (51 percent) say sub-$2 gas is "very unlikely," including 72 percent of fuel consumers in the West, according to the survey.
If gas prices were to fall below the $2-per-gallon threshold, however, consumers say it would have a very significant impact on their driving and spending behavior.
Specifically, one in three drivers say $2-per-gallon gasoline would have a "great impact" on their personal financial situation, including 43 percent of consumers from households with incomes under $35,000 per year.
In addition, two in five consumers (40 percent) say they would likely spend more on items other than gas if gas prices fell below $2 per gallon. A similar percentage say they would drive more frequently if gas prices fell below $2 per gallon.
"There is good news for retailers as consumer optimism picks up during peak vacation season. It could be a good month for anyone serving vacationers, including convenience stores," said NACS Vice President of Strategic Industry Initiatives Jeff Lenard.
NACS represents the convenience store industry, which sells 80 percent of the gas sold in the country. The August Consumer Fuels Survey was conducted online by Penn Schoen Berland; 1,100 gas consumers were surveyed August 4-6.