NJ Gas Prices Drop Before Memorial Day

NEW JERSEY— Drivers heading to beaches and parks this holiday weekend will see a bit of relief at the pump.

In New Jersey, gas prices for regular and diesel fuel dipped slightly to $4.75 a gallon for regular, down from $4.77 just a week ago — an all-time high. And diesel is down to $6.22 from last week's $6.31, according to figures from the AAA auto club.

But if you fill up on mid-grade or premium gas, expect an increase. Mid-grade gas is $5.15 per gallon, up from $5.12 last week. And premium is $5.37, up from $5.34 a gallon last week.

But let's not quibble about pennies. Drivers have a long memory. Remember last Memorial Day?

Last year this time, regular was an average of $3.05 in the state and $3.23 for diesel.

Now back to reality.

The worst days to buy gas in the state this year were May 20 for regular at that highest average recorded gas price of $4.77, and May 18, when diesel reached $6.33 per gallon.

Across the nation, since Monday, the national average for a gallon of regular gasoline has increased by a penny to $4.60. But according to new data from the Energy Information Administration (EIA), gasoline demand also dipped from 9 million barrels a day to to 8.8 million, about 700,000 barrels a day lower than a year ago. And the softening of gas demand has helped minimize price increases ahead of Memorial Day, AAA says.

And even with a spike in demand this holiday weekend, if demand slows again when we're back at work, pump price increases could be "limited" as crude prices remain volatile, the AAA notes.

The rise in gas prices appears to be slowing down, Patrick De Haan, GasBuddy's head of petroleum analysis, said earlier this week.

"While the coast isn't clear yet," De Haan said, "and prices will be at their highest Memorial Day level ever, I'm hopeful that we could avoid a dreaded national average of $5 per gallon this year. Whether or not we're able to depends on Americans cutting demand in the face of sky high prices."

AAA predicts 39.2 million Americans will travel at least 50 miles from home this Memorial Day Weekend — 8.3 percent more than last year and almost in line with 2017's figures. And 34.9 million of them will travel by car, according to AAA's forecast.

In New Jersey, the auto club expects that to take the form of 936,442 holiday-weekend travelers, including 860,330 by car.

National gas prices have risen every month since April 2020, when they averaged $1.94 per gallon at the beginning of the pandemic, according to the U.S. Energy Information Administration.

COVID measures created instability in the oil market as more people stayed home instead of driving to work and other places. That's largely changed, but supply hasn't recovered, according to Berkeley Energy Institute analyst Severin Borenstein.

"Most of the increase has come from crude oil prices going up, and that's because world demand has been coming back quite strongly from the pandemic and supply hasn't caught up," Borenstein told CBS News.

Russia's invasion of Ukraine sent the market of elevated oil prices into further disarray, with gas up more than $1.05 since the Russian military crossed into the territory Feb. 24, according to AAA.

"That sent shock waves through the oil market that have kept oil costs elevated," said AAA spokesperson Andrew Gross. "Domestically, meanwhile, seasonal gas demand is rising as more drivers hit the road, despite the pain they face paying at the pump."

But profits for oil and gas companies have also soared. In the first three months of the year, Chevron's profits increased 33 percent over the last three months of 2021, according to CBS News. Shell's profits are up 42 percent, Conoco Philips profits jumped 43 percent and British Petroleum's rose by 51 percent.