Memorial Day Weekend Officially Kicks Off the Summer Driving Season

Keith Kohl

Written By Keith Kohl

Posted May 28, 2024

If you’ve got a dime invested in oil stocks right now, or even thinking of putting some skin into the game, then it’s imperative you understand what will drive oil prices today. 

The first catalyst just passed us by: Memorial Day weekend. It’s a weekend that my readers and I tend to look forward to every year, and officially marks the start of the summer demand season. 

This year was no exception. Heading into last weekend, expectations were as high as we could expect. 

In fact, AAA projected that 43.8 million people traveled 50 miles or more for Memorial Day. To put a little perspective on this figure, this would be the second busiest Memorial Day on record — coming in just a hair below 2005’s record of 44 million travelers. 

Go ahead and take a look for yourself: 

AAA Gas 2024

If this projection proves accurate, we’ll see a 4.1% year-over-year growth in Memorial Day travel. 

That would be a great start to the summer driving season, and a much needed boost to demand confidence. Remember, if the EIA weekly reports are right, gasoline consumption has been a little lackluster until last week, when it reported a strong surge in demand. 

Despite the increase, the EIA numbers show that the 4-week average in gasoline demand is 1.8% lower than where it was a year ago. 

Unfortunately for the 38.4 million travelers driving this weekend, prices at the pump are already higher than they were last year. 

Last week, we talked a little about the relief that President Biden was hoping to bring to the average price of $4.61 per gallon that we’re all paying right now. His plan was to take the Congressional mandate given in March and sell off the one million barrels of the Northeast Gasoline Supply Reserve. 

Look, I won’t knock the plan. Chalk it up to a personal disdain for politics, but the prudent move was to sell this gasoline between Memorial Day and July 4th. 

However, my problem is that the media is really making a mountain out of a molehill. 

Here’s the catch to this story most people don’t see…

Over the last four weeks, our gasoline demand has averaged approximately 8.9 million barrels per day — or roughly 250 million barrels in total! Then if you look at the details of the sales, you’ll see that the gasoline will be unloaded in increments of 100,000 barrels at a time. 

Make no mistake, this is a drop in the bucket to our total demand…

Selling off the entire gasoline reserve all at once would only account for about 2.7 hours of U.S. gasoline consumption. 

Kinda puts things into perspective, doesn’t it — but hey, it makes for a good headline, right?

Now it’s time to throw aside the catchy click-bait and focus on what really matters. 

Heading into last weekend, WTI crude was trading just shy of $78 per barrel. That’s a good thing if you’re still looking to throw some skin into the oil game. Your attention should be concentrated on two things. 

First, oil traders are eagerly eyeing up demand trends. Over the next few weeks, we’ll get a better idea of whether or not high inflation will keep Americans off the roads this summer; I expect to see demand slowly ramp up as we head deeper into summer. 

Then you need to understand what’s going on with the supply side of the equation. This will be an interesting piece of the puzzle, especially since most analysts aren’t expecting U.S. oil production to run much higher than where it currently is. 

Assuming OPEC and Russia keep their production cuts intact throughout the rest of the year, it’s easy to see WTI crude trading above $90 per barrel this summer. 

Of course, that’s also forgetting about two other major catalysts that could suddenly send oil prices surging higher. 

We’ll talk about those two price drivers on Thursday.

Until next time,

Keith Kohl Signature

Keith Kohl

follow basicCheck us out on YouTube!

A true insider in the technology and energy markets, Keith’s research has helped everyday investors capitalize from the rapid adoption of new technology trends and energy transitions. Keith connects with hundreds of thousands of readers as the Managing Editor of Energy & Capital, as well as the investment director of Angel Publishing’s Energy Investor and Technology and Opportunity.

For nearly two decades, Keith has been providing in-depth coverage of the hottest investment trends before they go mainstream — from the shale oil and gas boom in the United States to the red-hot EV revolution currently underway. Keith and his readers have banked hundreds of winning trades on the 5G rollout and on key advancements in robotics and AI technology.

Keith’s keen trading acumen and investment research also extend all the way into the complex biotech sector, where he and his readers take advantage of the newest and most groundbreaking medical therapies being developed by nearly 1,000 biotech companies. His network includes hundreds of experts, from M.D.s and Ph.D.s to lab scientists grinding out the latest medical technology and treatments. You can join his vast investment community and target the most profitable biotech stocks in Keith’s Topline Trader advisory newsletter.

Angel Publishing Investor Club Discord - Chat Now

Keith Kohl Premium



Hydrogen Fuel Cells: The Downfall of Tesla?

Lithium has been the front-runner in the battery technology market for years, but that is all coming to an end. Elon Musk is against them, but Jeff Bezos is investing heavily in them. Hydrogen Fuel Cells will turn the battery market upside down and we've discovered a tiny company that is going to make it happen...

Sign up to receive your free report. After signing up, you'll begin receiving the Energy and Capital e-letter daily.