Labor Day Holiday Travelers Face Higher Gas Prices, Possible Disruptions

Americans are heading into the long holiday weekend facing higher gasoline prices at the pump since the start of the year, and the potential for travel disruptions as a powerful storm makes its way toward Florida’s Gulf Coast.

The price of a gallon of unleaded gasoline is 19.6% higher at the pump since Dec. 31, 2022, and up 2.3% from one month ago, according to data from Oil Price Information Service. One glimmer of good news for drivers: The price of unleaded is down 1.2% since the beginning of last week, to $3.8192 a gallon as of Monday, OPIS said.

But that recent drop may be short-lived, according to Patrick De Haan, head of petroleum analysis at GasBuddy. He said one of the nation’s largest refineries partially shut last week after a fire at a storage tank. There is also the approaching Tropical Storm Idalia, which is expected to strengthen into a major hurricane before making landfall in Florida this week, according to the National Weather Service.

“While GasBuddy is closely monitoring Florida for challenges related to Idalia and is prepared to activate the fuel availability tracker, the rest of the nation could see gas price declines reversing pending the outcome of refinery issues that continue to put upward pressure on wholesale gasoline prices,” De Haan wrote.

More Americans are heading out of town for Labor Day weekend, with domestic bookings for flights, hotels, rental cars, and cruises up 4% from last year, while international bookings are up 44%, according to AAA. They are also taking longer vacations this year, especially for those who can work remotely from their destination, said Paula Twidale, senior vice president of AAA Travel. 

The top five domestic destinations are: Seattle, Orlando, Anchorage, New York, and Las Vegas. Domestic cruise bookings are 19% higher than last year.

“Internationally, it’s all about Europe and Canada,” Twidale said. Compared with 2022, international hotel bookings are up 82%, and international cruise bookings are up 44%. The top five destinations are Vancouver, Rome, London, Dublin, and Paris.

INRIX, a global provider of transportation data and insights, expects 2 p.m. to 6 p.m. on Thursday, Aug. 31, to be the busiest time on the roads during the holiday weekend, and higher-than-normal traffic volumes between 11 a.m. and 9 p.m. Friday, Sept. 1. 

Domestic airfares are averaging $226 a ticket over Labor Day weekend, down 11% from last year and 20% lower than Labor Day weekend 2019, according to the Hopper travel app. Airfare to Europe this weekend costs an average of $1,132 a ticket, down nearly 10% from last year, but still higher than in 2019. 

More than 20 million passengers are expected to leave from U.S. airports between Thursday and Tuesday, up 14% from last year. That includes 3.7 million passengers on Friday, and 3.6 million on Monday, Hopper said.

Atlanta is expected to be the busiest airport this weekend, with 1.5 million passengers expected, while Denver is second with 1 million. Dallas, Los Angeles, and Chicago airports each expect more than 800,000 passengers departing, according to Hopper.

Hotel rooms are averaging $215 a night, 3.8% higher than last year, while car rental prices are down 14.5%, to an average of $41 a day, Hopper said.