• U.S. gasoline retail margins surged to 51.3¢ per gallon, near the year's highest point, maintaining above 50¢ for four consecutive days despite falling futures prices.
  • Retail prices have remained remarkably stable at a national average of $3.06 per gallon, with the Pacific Coast experiencing the most dramatic margin expansion at 89¢ per gallon—a 34% year-over-year surge.
  • Despite AAA projecting a record 73.3 million Americans traveling by car for Thanksgiving, gasoline demand remains notably weak at 3.2% below last year across all regions.

U.S. fuel retailers are entering the Thanksgiving travel period with exceptionally strong profitability as gasoline margins hit their highest levels of the year, creating a favorable setup ahead of one of the busiest travel weekends.

The national average gasoline margin reached 51.3¢ per gallon on Monday, maintaining above the 50¢ threshold for four straight days even as gasoline futures declined 6.4% last week. This margin strength comes despite weak underlying demand and rising inventories that have pressured wholesale markets.

Retail prices have shown remarkable stability, averaging $3.06 per gallon nationally with little movement since mid-October. The national average for Thanksgiving is forecast at $3.02 per gallon, matching 2024 levels and representing one of the lowest holiday gas prices since the pandemic era.

Regional variations are particularly pronounced, with the Pacific Coast experiencing margin expansion to 89¢ per gallon—a 34% increase compared to the same period last year. This stands in stark contrast to states like Oklahoma and Mississippi, where prices have fallen to as low as $2.49 per gallon.

"We're seeing exceptional margin conditions heading into the holiday," said one fuel market analyst who asked not to be named because they weren't authorized to speak publicly. "The stability in retail pricing despite wholesale weakness suggests retailers are capturing significant value in this environment."

The margin strength comes as refiners have nearly completed seasonal maintenance projects, with capacity utilization rates recovering to 90% from 86%. However, gasoline stockpiles remain particularly thin at 205.1 million barrels as of November 7—the lowest level since November 2014.

Travel patterns present a complex picture. While AAA projects a record 73.3 million Americans will travel by car for Thanksgiving, GasBuddy's survey indicates only 60% of Americans plan to take a road trip—a sharp decrease from 72% in 2024. Notably, 74% of survey respondents say gas prices have no effect on their travel plans, up from approximately 56% the previous year.

Patrick De Haan, head of petroleum analysis at GasBuddy, noted that "concerns about a cooling economy may be weighing on Americans' willingness to travel" despite affordable gas prices.

West Texas Intermediate crude oil has declined significantly, dropping $1.69 per barrel over two weeks to $58.06 per barrel, equivalent to approximately 4 cents per gallon. Lower crude prices have supported stable retail gasoline pricing even as margins expanded for downstream operators.

The four-week average of gasoline product supplied, a key demand indicator, was 8.82 million barrels, down 6% year-over-year. This demand weakness across all regions contrasts with the expected travel surge, suggesting shorter trip distances or more efficient vehicle usage.

Among those traveling, 56% expect to cross at least one state line, and 66% anticipate driving more than 100 miles. Approximately 60% of travelers plan to use loyalty or cash-back programs to save on fuel costs, according to survey data.

Market participants will be watching whether the strong margin environment persists through the holiday weekend or normalizes as travel patterns become clearer. The current margin levels remain approximately 11 cents thinner than they were in mid-October, indicating there's still room for improvement from the retailers' perspective.