There was some good news this week, as prices dropped 8.4 cents a gallon over the previous week in Texas, according to GasBuddy, a company that provides gas price comparisons to consumers and businesses.
On June 22, President Joe Biden said he will ask Congress to lift federal taxes on gas through the end of September as part of an effort to ease the burden of gas prices.
For Texans, who are now paying about $4.62 a gallon on average, according to GasBuddy.com, lifting federal taxes on gas could save about 18 cents per gallon. The federal tax makes up about 4% of the price of a gallon of gas in the state, said AAA Texas spokesman Daniel Armbruster.
With the average car having a 14-gallon tank, a drop of 18 cents per gallon would mean about $2.50 in savings per fillup, said Armbruster.
“That’s not a lot, but it may make a difference for some,” he said.
Texas drivers pay a 20-cent state tax for each gallon. The federal gas and much of the state gas tax tax are used to maintain and build transportation infrastructure.
AAA Texas spokesman Armbruster wonders if the tax pause could create a funding gap for infrastructure projects that have been a big push of the Biden administration.
“We’ll see how it comes out if Congress approves the gas tax plan, but it could cost a lot in the long run to lose that funding,” he said.
For Jim Grundy, CEO and owner of Sisu Energy LLC in Fort Worth, a company that provides trucking operations for the oil and gas industry, the increase in oil and gas drilling is creating a lot of business for his company. But he knows that comes at a price for consumers.
“It’s not good in the long run for consumers to have those price increases,” he said. “I’m afraid in the long run, it’s going to create more inflation and that wouldn’t be good for anyone.”
According to GasBuddy, gas prices are now $1.92 per gallon higher than a year ago. Despite the recent increases in gas prices, Texans are expected to hit the road in record numbers over the holiday weekend. AAA Texas expects 3.1 million people will travel for the holiday.
“That was a bit of a surprise, but we think there is a lot of pent-up demand following COVID, and there are concerns about cancellations and delays at airports,” Armbruster said.
Nationwide, AAA predicts nearly 48 million people will travel for Independence Day, with 88% using their automobile. That will contribute to a record 42 million people driving to holiday destinations.
AAA Texas expects to respond to over 21,000 calls for roadside assistance over the 4th of July.
Armbruster said Texas drivers should prepare for delays.
“There’s little doubt it’s going to be crowded out there,” he said.
Patrick De Haan, head of petroleum analysis at GasBuddy, a Boston-based company that provides information on gas prices to consumers and businesses, said it is more important than ever to shop for lower prices for gasoline.
“I’m hopeful the trend (for lower prices) may continue this week, especially as concerns appear to be mounting that we may be on the cusp of an economic slowdown, putting downward pressure on oil,” he said.
AAA Texas’ Armbruster said it could pay to check prices.
“It’s a very dynamic market, so prices can change quickly,” he said.
Bob Francis is business editor for the Fort Worth Report. Contact him at bob.francis@fortworthreport.org. At the Fort Worth Report, news decisions are made independently of our board members and financial supporters. Read more about our editorial independence policy here.
This article was originally published by Fort Worth Report.