LANE RANGER: AAA says people adjusting budgets due to gas prices

By the Lane Ranger
Published: July 20, 2008

Results from recent AAA Mid-Atlantic member survey show that people are adjusting their household budgets to to make up for higher gas prices.

According to the survey, 71 percent of the respondents said they were cutting spending elsewhere to be able to afford gas, stated a car club press release.

Entertainment, personal shopping, home improvement and leisure travel are the areas where people say they are adjusting their budgets to make up for the cost of gas, according to the AAA.

Four in 10 of the 387 respondents said they had cut back on the money they spend on food so that they could afford gas.

AAA spokesman John B. Townsend II said that 48 percent of the respondents expect more bad news.

“What’s interesting is that many of us expect those prices to climb even higher.” Townsend said in the release. “Nearly 90 percent believe it’s likely we’ll have $5 gas this year,” Townsend stated in the release. “Here’s hoping they’re wrong.”

Almost a quarter of those who completed the survey, or 23 percent, said they would drastically cut back on driving at $4 per gallon.

Nationwide, the price of a gallon of gas is $4.11, a recorded high.

Thirty percent of the respondents said if gas prices go higher they will have to drastically alter their driving habits, the release stated.

“We’ve already seen a marked decrease in vehicle miles traveled — cumulatively, it’s down 2.1 percent for 2008 — at current prices,” Townsend said. “It will be interesting to see, if pump prices continue to rise, what additional reactions motorists have.”

Americans are currently spending $1.6 billion a day on fuel purchases, Townsend said.

But there might be a glimmer of hope on the horizon.

Crude oil prices fell last week, going from $145 a barrel at the beginning of the week to $129 a barrel at week’s end, according to car club statistics released Sunday.

The decline was the result of higher inventories of oil and gas, according to figures released Wednesday by the U.S. Department of Energy, the release stated.

Demand for fuel in the U.S. averaged 9.3 million barrels a day over the last four weeks which is down 2.1 percent from the same period last year the release said.

But prices held steady at the pump, the AAA release said.

Automobile travel is at its peak in July and August.