$3 gas: America’s braking point

After shrugging off high prices for years, American drivers are finally starting to cut back. Is it a sign of shifting habits, or looming recession?

NEW YORK (CNNMoney.com) — Gasoline demand has fallen for the first time in years as drivers appear to recoil from near-record prices, throwing doubt on America’s seemingly insatiable thirst for fuel.

Although growth in gasoline demand has been slowing all year, demand has actually fallen for five of the last six weeks compared to the same time last year, according to retail sales data gathered by MasterCard SpendingPulse, a research report that tracks gasoline sales using MasterCard, other credit cards, and cash sales at approximately 140,000 service stations service stations around the country.


“With prices over $3 a gallon, there seems to be some real resistance from the consumer,” said Michael McNamara, director of research for MasterCard SpendingPulse.

In some weeks demand has fallen by as much as 3 percent.

Although the public has seen $3 gasoline before, 2007 has been different. Where previous price spikes were short-lived, this one seems to be here to stay.

Another reason demand is falling could be due to a slowing economy, or even fears of a recession.

CNN