Highest gas prices since 2008 expected for July 4th weekend

With gas prices on the rise again, West Baltimore resident Coralee Penner says she may sell the "gas-guzzling" Hummer H3 she's driven since 2007.

Penner said she's considering replacing her SUV with a more compact car to save on gas. In the meantime, she's been driving less and planning more.


"I deliberate for a while about where I'm going to go and if it's necessary and if I can combine trips and do everything in one go," said Penner at the North Charles Street Hess station, where regular fuel was $3.65 per gallon Monday.

Motorists this Fourth of July holiday will see the highest gas prices since 2008, when costs peaked at over $4 a gallon during the summer, analysts project, attributing the recent rise to the surge of violence in Iraq, a key glocal oil supplier.


On Monday, regular gas in Baltimore averaged nearly $3.71 per gallon, a nickel more than the national average of $3.66, according to AAA Mid-Atlantic, which tracks prices throughout the region. That's up about eight cents from a month ago and 27 cents more than it was a year ago.

Prices will rise a little more Tuesday, when Maryland's gasoline tax increases by four-tenths of a penny, bringing the total tax to just over 27 cents per gallon, AAA said.

The tax increase is part of a 2013 bill proposed by Gov. Martin O'Malley and passed by Maryland lawmakers to increase the gas tax in keeping with inflation, as measured by the Consumer Price Index. The hundreds of millions of dollars the increased gas taxes will bring in annually is intended to fund all transportation projects, from highways and bridges to transit and Baltimore/Washington International Thurgood Marshall Airport.

Before the bill's passage, Maryland hadn't increased the state gas tax in more than 20 years, since 1992.

"While no one is ever happy to see prices increase at the pump … it is unfortunately very necessary for system preservation and for the safety and the maintenance of our transportation infrastructure," said AAA spokeswoman Ragina Cooper-Averella. "It's a necessary evil if we want to ease congestion on your roadways."

While the high prices won't stop more than 828,000 Marylanders from hitting the road for the holiday weekend, Cooper-Averella said, they may cause consumers to cut back elsewhere.

"What we typically see is traveling by auto, particularly if you're traveling with a family, despite gas prices being higher than what they were this time last year," she said. "Motorists opt to change their spending in areas where they do have a little more control, a little more flexibility."

Drivers will face high gas prices through the peak summer driving season, said Tom Kloza, chief oil analyst for Gasbuddy. Prices should moderate later in the summer as demand ebbs, he said.


Kloza said the rise of fuel-efficient vehicles and fewer miles logged by an aging population explains the fall in demand he anticipates. Prices might not have much to do with it, he said.

"I don't think we're at a pricing point which is damaging the consumer psyche or causing them to pull back on their driving," Kloza said. "You go to California, where you have over $4 most of the time, and people are still driving. We're not close to one of those tipping points where you get a lot of demand destruction."

The average national cost per gallon this year is actually a nickel less than the first half of 2013, according to Gasbuddy — $3.52, down from $3.57.

It's still too much for Baltimore resident Joey Lane, who said traveling between jobs for a construction company can cost him $150 per week in gas.

"We drive all over the place, man. I probably drive just as much as I work," said Lane, filling his Ram 1500 pickup truck that gets less than 20 mpg at the North Charles Street Hess station. "It's getting harder and harder to keep this beast full."

Even consumers who drive less and make more are hurting, said Baltimore resident James Durrah.


"It's hard for any consumer in that market, anyone in any tax bracket," Durrah said at the BP station at Mount Royal Avenue and St. Paul Street, where regular gas was $3.89 per gallon Monday. "Almost everyone drives and is affected by this. I can remember filling up for 10, 15 bucks. It's now 50 bucks to fill up my Honda Civic, and even if you're making six figures, that adds up."