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Gas prices, now averaging $3.11 a gallon nationwide, will rise another 10 cents by December, the EIA's Guy Caruso predicts.
updated 11/15/2007 9:52:50 AM ET 2007-11-15T14:52:50

Gas prices near record highs at a time of year when they typically decline will not deter drivers from hitting the road this Thanksgiving, AAA said Thursday.

The travel agency expects a record 38.7 million Americans will travel 50 miles or more from home over the five days beginning Nov. 21. That is a 1.6 percent increase over last year. Roughly 80 percent of those trips will be by car, and motorists will pay about 90 cents a gallon more for gas than they did last year.

Guy Caruso, chief of the Energy Department’s statistical division, the Energy Information Administration, predicted Wednesday that gasoline prices, now averaging $3.11 a gallon nationwide, will rise another 10 cents by December.

A jump of 15 cents a gallon from current levels, already well above last year’s average of $2.23, also would surpass May’s all-time record of $3.23 a gallon.

Gas prices traditionally fall in the winter months as demand ebbs from summer highs, but oil prices flirting with $100 a barrel and low fuel stockpiles have reversed that trend this year. Still, demand for gasoline over the four weeks ending Nov. 2 was 0.8 percent higher than a year earlier, averaging more than 9.3 million barrels a day.

“This is the first time that we have seen gas prices tipping over $3 a gallon in November,” Robert L. Darbelnet, president and chief executive of AAA, said in a statement. “But Thanksgiving is traditionally a time for family gatherings, and higher gas will not discourage Americans from reconnecting with their loved ones.”

Some 31.2 million motorists will hit the road for Thanksgiving, a 1.3 percent increase from last year. Another 4.7 million will travel by air, and the remainder will go by train, bus or other transportation.

While travelers will be paying more at the pump, hotels, airfares and car rental prices are mostly declining this year, according to AAA. Holiday hotel rates are down 3 percent for AAA-Rated Three Diamond hotels and up a modest 1 percent at Two Diamond hotels. The average decrease in rental car prices is 12 percent, and airline tickets are down about 7 percent.

Cheaper airfare or not, the airline industry this week urged holiday travelers to get to the airport extra early due to an expected 4 percent jump in passenger traffic.

Domestic carriers are expected to fly roughly 27 million passengers worldwide over 12 days beginning Nov. 16, with planes about 90 percent full, according to the Air Transport Association.

The expected increase comes in a year of record-low punctuality for the industry. Through September, more than 24 percent of flights arrived late, according to the Transportation Department. That’s the industry’s worst on-time performance since comparable data began being collected in 1995.

President Bush, who in September promised to take steps to reduce air traffic congestion and long ground delays, is expected to update those plans later Thursday.

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