COVID-19 Pandemic Has Created a New Gas-Buying Landscape
BOSTON — With millions of Americans working and studying from home, cancelling international travel and generally upending their routines due to COVID-19, a new gas-buying landscape has emerged, according to a new report from GasBudddy.
This summer, the average number of fuel transactions saw a smaller drop than expected, declining just 6 percent from June through August compared to summer 2019. The decrease was primarily driven by the growth of car sales, especially used cars, as consumers who live in cities and typically take mass transit sought to avoid close quarters on trains, buses and ride-shares.
The number of consumers who left the city for the suburbs and require car transportation also contributed to the smaller drop.
Motorists are also changing when they buy gas. The shift to remote work led more drivers to fill up during typical work hours, with a 12-percent increase in gas purchases from 9 a.m. to 12 p.m., and a 27-percent decrease in purchases from 6 p.m. to 12 a.m. The usual morning commuting time was also affected, with a 12-percent decrease in fuel purchases from 4 a.m. to 7 a.m.
This trend was more pronounced in sprawling metropolitan areas such as Los Angeles, where midday fill-ups from 10 a.m. to 2 p.m. rose 12 percent, while fill-ups after 6 p.m. fell 16 percent and fill-ups from 4 a.m. to 7 a.m. fell 16 percent.
Fridays remained the busiest day to buy gas, continuing a trend from 2019.
"If remote work becomes a long-term reality, this could reshape the U.S. c-store industry from demand levels to consumer habits," said Patrick De Haan, head petroleum analyst at GasBuddy. "Removing limitations like having to commute to work or picking up the kids from soccer practice opens up the window of time as to when people run their errands, as evident by GasBuddy data that clearly shows a significant shift in when fuel transactions are occurring."
Summer gas prices ranged from 40 cents to 80 cents cheaper per gallon than the same months in 2019. This likely prompted consumers to buy more expensive, higher grade fuels, as midgrade fuel purchases rose 19 percent and premium fuel purchases rose 8 percent. Overall regular grade fuel purchases decreased 3 percent. Retail diesel fuel purchases also saw a notable increase of 6 percent, likely caused by an increased in RV travel over the summer.
"Record low fuel prices and little-to-no air travel led consumers to explore alternative and perceived safer vacation options, including road trips and RV rentals," De Haan said. "If the pandemic continues, this trend will likely hold through the holidays and into the New Year. We could see increased sales in vehicle maintenance items as motorists get more out of their vehicles."
The differing rates at which COVID-19 cases spread through different regions of the United States served as another factor in changing demand. Later-hit areas such as the Southwest saw a downturn in fuel demand in June and July, prompting a 9-percent decline in transactions and a 10-percent decline in gallons purchased compared to regions that experienced their height of COVID-19 cases in April. This includes the Northeast, which saw a 7-percent decrease in transactions but a 7-percent increase in gallons purchased.
Regions with large expanses of roadway and highly condensed regions made fewer transactions but purchased more gallons per transaction. Gas stations in the Rocky Mountains saw a 26-percent increase in the average number of gallons purchased, though average transactions were down nearly 10 percent compared to last summer.
This is particularly true in states where motorists need to drive for an extended period of time like Montana and Wyoming, as well as states where driving is minimal and drivers can afford to wait to fill up, such as Massachusetts and Connecticut, according to GasBuddy. All regions saw a reduction in travel compared to one year ago due to COVID-19.
Boston-based GasBuddy connects drivers with their Perfect Pit Stop.