Optimism about the economy is up for the first time in seven months, and stable gas prices may be one reason behind the uptick.
Consumer sentiment increased slightly to 46%, a one-point increase from September, according to the results of a national consumer survey released by the National Association of Convenience Stores (NACS).
The last time at least half of the population was optimistic about the economy was March 2016, when gas prices averaged $1.80 per gallon and 50% expressed optimism.
U.S. fuel consumers report a median gas price of $2.20 per gallon, unchanged from September 2016, though more than $1 per gallon cheaper than in October 2014. At that time, gas prices were $3.35 just prior to American voters headed into the midterm elections.
“Stable gas prices appear to have stabilized consumer sentiment, which is recovering but still significantly below the 53% who were optimistic last October, said Jeff Lenard, NACS vice president of strategic industry initiatives. “Of course, the partisan political landscape also plays a significant role in tamping down optimism. It will be interesting to see if optimism jumps higher over the coming months—no matter who is elected.”
Men continue to be more optimistic than women (49% vs. 43%). Younger consumers ages 18 to 34 are the most optimistic by age (54%) and consumers in the West (51%) are the more optimistic by region (51%). Meanwhile, sentiment was unchanged in the South (44%), an area plagued by fuel supply challenges in September following the temporary shutdown of the Colonial Pipeline, which carries 2.5 million barrels per day of product to the Southeast, in particular. Only 9% of drivers in the South say that gas prices significantly increased last month compared to the national average of 7% of drivers who say prices increased significantly.
Looking ahead, U.S. fuel consumers are split on whether gas prices will rise or remain the same. Nearly half (49%) say they expect gas prices to continue to rise, while another two in five (40%) predict that prices will remain about the same as today. Just one in 10 (11%) U.S. fuel consumers say they expect gas prices to drop in the next 30 days.
Consumers say their vehicle’s average fuel efficiency increased to 23.8 miles per gallon, which is about 1% higher that self-reported mileage a year ago. Average miles per dollar—a calculation that examines gas prices related to vehicle fuel efficiency—increased slightly this month to 10.8 miles per dollar as gas prices remained constant and fuel efficiency increased.
NACS, which represents the convenience store industry that sells 80% of the gas in the United States, conducts monthly consumer surveys to gauge how gas prices affect broader economic trends. The survey was conducted online by Penn Schoen Berland; 1,100 U.S. adults who purchase fuel for a vehicle such as a car, truck or van at least once per month were surveyed Oct. 5-7, 2016.