Gas Prices Not Spoiling Consumers' Moods
ALEXANDRIA, Va. — Despite rising fuel prices, 61 percent of gasoline consumers report that they feel optimistic about the state of the economy, according to the latest consumer survey by NACS, the Association for Convenience & Fuel Retailing.
This marks an all-time high across the four-plus years the national survey has been conducted, surpassing the previous 58 percent high recorded in December following the presidential election.
A majority of Americans are optimistic across all demographics examined, according to the survey. Older Americans age 50 and up are the most optimistic age group (65 percent), compared to 55 percent of those ages 18-34. Regional differences also exist, with Southerners reporting the highest levels of economic optimism (64 percent) and Midwesterners reporting the lowest (56 percent).
Americans also report a 4-cent increase in gas prices in their area. The reported median gas price of $2.29 brings gas prices back to where they were in January, when gasoline consumers reported a $2.30 median price. Price increases are being felt most strongly in the West, where 52 percent report seeing gas prices higher than they were last month. In comparison, only 41 percent of those in the Northeast and South report seeing higher gas prices this month.
The majority of gas consumers expect prices to continue to increase in the next month, which is a time when gas prices generally face upward pressure as the fuels industry undergoes the annual transition to producing summer-blend fuel, according to NACS. More than half (51 percent) of all Americans say they expect prices in 30 days to be "much higher" or "somewhat higher" than they are today, while only 9 percent expect prices to drop during the coming month.
Rising gas prices traditionally have an inverse effect on consumer optimism. In March 2013, 85 percent of Americans said that gas prices had increased, and only 41 percent expressed optimism. However, gas prices were also much higher in March 2013, at $3.58 per gallon.
The current strong optimism may also result in increased sales at convenience stores, as 22 percent of consumers say they will drive more in the coming month and 19 percent say they will shop more. More than three quarters of consumers (76 percent) say that gas prices have an impact on their optimism. Additionally, the recent change to Daylight Saving Time adds an extra hour of daylight to the evening hours.
"With the extra hour people stay out later, and outdoor activities pick up — as do our sales," said Sonja Hubbard, CEO of Texarkana, Texas-based E-Z Mart Stores. "The time change equates to an immediate 10-percent lift in sales."
NACS represents the convenience store industry that sells 80 percent of the gas in the United States. The association conducts monthly consumer surveys to gauge how gas prices affect broader economic trends. From March 7-9, Penn Schoen Berland conducted the online survey of 1,102 U.S. adults who purchased fuel for a vehicle such as a car, truck or van at least once per month.