Scaled-back travel plans likely for holiday weekend
By Bruce V. Bigelow, The San Diego Union-Tribune staff writer

May 21, 2008

Under continuing pressure from the cost of crude oil, fuel prices pushed to record highs in San Diego and nationwide yesterday - all but ensuring there will be $4-a-gallon gasoline over the Memorial Day weekend.

In San Diego County, the average price for a gallon of regular gas was $3.99 yesterday, according to the San Diego-based Utility Consumers' Action Network.

"It's looking like Thursday will be the day for $4 gas, unless by some miracle the seas part and the spot market settles down," said Charles Langley, UCAN's gasoline specialist.

Alas, the markets showed no signs of cooperating.

On Wall Street, crude oil spiked to almost $130 per barrel yesterday as concerns mounted over global supplies. Oil prices are putting pressure on broad areas of the economy - from airlines that pay more for fuel to farmers who face higher costs for diesel and petroleum-based fertilizer.

The June contract for light, sweet crude traded as high as $129.60 on the New York Mercantile Exchange before settling at $129.07, up $2.02 from Monday's record. It was the 10th time in the past 12 sessions that crude has hit trading or closing records.

The unrelenting rise of crude prices carried the national average for a gallon of regular gas to $3.80 for the first time.

In California, the average price was a record $3.98 yesterday, according to AAA's Daily Fuel Gauge Report. The statewide average for diesel was $4.83.

Industry observers say demand for diesel has become especially strong in China, where some power plants are running desperately short of coal and certain earthquake-affected regions are relying on diesel generators for power. The country also is ramping up its diesel imports in preparation for the Beijing Olympics in August.

That's driving up worldwide diesel prices, said Darin Newsom, senior analyst at market analysis provider DTN.

"They're going to continue to bring in diesel for their power plants and are going to have plenty on hand" for the Olympics, Newsom said. "What's going to happen after that, we don't know."

Crude oil, though, has been the underlying force that is pushing fuel prices higher, said Fred Rozell, retail pricing director at the Oil Price Information Service.

"Diesel and gas are just taking a ride," Rozell said.

The effects have been noticeable, but not dramatic, for the coming Memorial Day weekend in San Diego, which ranks as the top destination for Southern California travelers, according to a survey of AAA travel agents.

While soaring gas prices are prompting travelers to scale back their plans, the Auto Club of Southern California says 2.9 million Southern California residents are still expected to take trips this weekend.

That's one-tenth of 1 percent less than last year, AAA said.

With regular gas at $4 per gallon, it would cost about $140 to drive round-trip from Phoenix to San Diego in a vehicle that gets 20 miles per gallon. That's about $20 more than it would have cost last year, but nearly double what it would have cost as recently as 2004.

The effects are more obvious among RV owners, who often buy hundreds of gallons of fuel at a time, and recreational boaters, who are paying more for their fuel.

"There's no question that (fuel) sales are dramatically off on recreational use," said Steven Pinard, who owns the Dana Landing Market and Fuel Dock on San Diego's Mission Bay.

Regular gasoline at the dock is $5.19 per gallon, Pinard said, and higher-volume purchases carry a lower price.

Pinard added that boat rentals remain strong.

"People coming from Arizona and Vegas are going to come out here and rent my stuff. They're going to use my Jet Ski or motorboat," Pinard said. "But for the people who own their own boats, the ski boats and Jet Skis, a family just can't afford to do it any more."

At the San Diego Marriott Hotel & Marina, marina manager Ken Guyer said he has seen a steady decline in reservations for temporary guest slips over the past six months by out-of-town boaters from harbors in Newport Beach or Long Beach.

"I'm just kind of surprised that we're seeing a fall-off in reservations for this weekend as well," Guyer said.

Yet the guest slips already are booked for the July 4 holiday, and reservations are filling up for Labor Day.

"That's an indication to me that the boats from out of town are picking and choosing their travel holidays a lot more carefully," Guyer said.

Among the 8.2 million families that own RVs in the United States, 76 percent say they are going to use their RV in 2008 as much or more than last year - but they'll travel fewer miles, according to the Virginia-based Recreation Vehicle Industry Association.

At RVtravel.com, nearly 63 percent of 1,818 RV owners who responded to an online survey said they planned to travel fewer miles this summer because of higher gas prices.

RV sales nationwide are down almost 12 percent from last year, said RVIA spokesman Kevin Broom. Yet RV rental companies report that their bookings are up 20 percent, and Broom said campground bookings are up 5 percent to 15 percent.

"What we're seeing, according to the campgrounds, is that they're getting more in-state bookings," Broom said.

In California, reservations at state campgrounds for this weekend are running slightly ahead of last year, said Roy Stearns, a spokesman for the California Department of Parks and Recreation. About 10,000 of California's 15,000 total campsites require reservations.

Stearns said the campsites at Silver Strand State Beach and Carlsbad State Beach are booked.

"Our coastal campgrounds always fill up first," Stearns said. "In fact, they fill up seven months in advance, when our reservation system opens."

Barbara Kettle of Glendora, with an oceanfront view at Carlsbad State Beach, said the price of gas is leading her and her husband, Jerry, to reconsider their vacation plans.

The Kettles will spend an estimated $140 for this week's trip in their 36-foot Fleetwood, which gets eight miles per gallon. They plan to return to Glendora on Friday.

In the longer term, the annual summer trip to Montana may be put on hold. The couple recently bought a carrier for Jerry's Harley-Davidson motorcycle, but with high gas prices, his plans for cruising to Montana may have to wait.

"We'll stay at home and enjoy our swimming pool, I guess," Barbara Kettle said.