ALEXANDRIA, Va. -- As gasoline prices have trended upward over the last several weeks, a new survey has revealed what point they need to hit before consumers say it would convince them to drive less.
That magic price point: $3.37 per gallon, according to the most recent NACS Consumer Fuels Survey. While this price would encourage consumers to decrease their driving, it would take at least $4.43 per gallon before they say they would cut driving dramatically or seek transportation alternatives.
The national average as of April 7, 2017, was $2.391 per gallon, according to Boston-based GasBuddy. The last time the national average flirted with the $3.37 mark was in fall 2014, and it has never reached a $4.43-per-gallon level.
In the NACS survey, 84% of consumers said that low gas prices were good for the economy, which is 1 point lower than the April 2016 survey.
“These findings are in line with what we traditionally find in our monthly surveys: Consumers say that prices have to increase by about a dollar per gallon from its current price before they consider cutting back,” said Jeff Lenard, vice president of strategic industry initiatives for NACS, Alexandria, Va. “Gradual price increases also gradually push up the price at which they would drive less and it would take a sudden, unexpected price increase before most drivers would consider driving less.”
Gas prices tend to follow seasonal patterns, beginning with a gradual increase during the first few months of the year as refiners switch over to making more expensive, summer-blend gasoline. The price increase between early February and the typical late-May seasonal peak has averaged 53 cents per gallon (CPG) since 2000.
Other highlights of the survey:
- Consumers agree that world events have greater sway over gas prices than their local gas station, with 29% citing the Organization of the Petroleum Exporting Countries (OPEC) for oil-price increases, vs. only 4% who believe gas stations are to blame.
- More than one-half (57%) of consumers agreed that most gas stations are small businesses (as opposed to being run by a major oil). According to NACS figures, 58% of gas stations are single-site operations.
- About two-thirds of consumers say that c-stores share their values and conduct business ethically, vs. 34% who disagree.
- Consumers also seem largely aware of fuel retail’s slim profits. Forty-three percent said that profits are about 5 cents per gallon. NACS data show that industry fuel gross margins average around 20 CPG, while after expenses they fall to about 5 CPG.
This most recent NACS Consumer Fuels Survey was conducted online from Jan. 4-6, 2017, by Penn Schoen Berland with 1,114 U.S. adults who purchase fuel for a vehicle at least once per month.
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