The Biden administration’s move to sell 1 million barrels of gasoline from a reserve in the Northeast is unlikely to have a substantial effect on pump prices as summer driving season gets underway, according to market analysts. 

The Department of Energy said Tuesday the sale would be timed to have a maximum impact on prices this summer with deliveries completed before the Fourth of July holiday.

But the barrels in the Northeast Gasoline Supply Reserve are equivalent to just 2.65 hours of total U.S. gasoline consumption and two or three days in the areas where the gas is stored, said Patrick De Haan, head of petroleum analysis at GasBuddy.

“It’s not going to be a huge needle mover,” De Haan said, though the sale could provide 5 cents to 10 cents of relief in the Northeast where the gasoline market is historically tight.

“This is not going to be huge party at the pump,” the analyst said.

The motorist association AAA agrees, with spokesman Andrew Gross saying the sale might “help stave off any regional pump price surges, but likely won’t move the national average that much.”

Oil prices surged last month as Israel and OPEC member Iran stood on the brink of war, raising concern at the White House that gasoline prices could jump heading into the summer.

But gas prices have been trending lower for weeks now as demand has softened and U.S. oil prices have pulled back 11% from April highs after a broader conflict in the Middle East was averted.

Prices at the pump are averaging about $3.61 per gallon nationwide heading into Memorial Day weekend, around 5 cents lower than the average last month, according to data from the motorist association AAA. However, current prices are still roughly 5 cents higher than the year-ago average.

When adjusting for inflation, pump prices are about 2% lower compared to last year, according to the Energy Information Administration.

The gasoline sale announced by the Biden administration fulfills a mandate passed by Congress in March to close the Northeast Reserve this year.

De Haan said the reserve didn’t make financial sense to begin with. It was set up in in 2014 in the aftermath of Superstorm Sandy, which knocked out refineries and caused chaos at the pump.

But the reserve cost taxpayers $200 million just to maintain while the gasoline in the stockpile is only worth about $103 million right now, De Haan said.

“I don’t like the political victory lap,” he said of the Biden administration’s announcement. “It didn’t make sense to have this reserve. [Former President Donald] Trump tried to shut it down in 2020. Congress now approved it being shut down.”

De Haan said the summer driving season is already getting off to a “soft start,” with gasoline demand about 8% lower through Thursday compared to the year-ago period. Even in costly California, gasoline prices are down about 27 cents over the past four weeks, he said. 

“We know a lot of folks are saying they’re going to be traveling for Memorial Day,” De Haan said. “That would just imply to me that more people may be flying than driving this time around.”

AAA, however, is forecasting a record 38 million drivers will take to the road this weekend, a 4% increase compared to last year. This could move prices slightly higher, the group said.

But De Haan said gasoline prices will likely edge lower through the Fourth of July holiday as refiners increase output, which should keep downward pressure on pump prices. 

For July, GasBuddy is forecasting prices in a range of $3.39 to $3.72 per gallon on average nationwide. De Haan expects prices to be in the lower half of that range and generally sit in the mid-$3 range.

“Since the pandemic, the summer driving season has not seen a surge in demand, which can push pump prices higher,” said Gross, the AAA spokesperson.

The gasoline price outlook becomes more uncertain heading into Labor Day on Sept. 2. Hurricane season in the Atlantic is expected to be extremely active this year, according to forecasts from Colorado State University Tropical and Weather Climate Research.

The Colorado university report is forecasting 11 hurricanes this season, the highest number ever issued in its April outlook due to extremely warm sea surface temperatures and the likely development of La Niña conditions. There is a 42% chance that a hurricane makes landfall on the Gulf Coast, the hub of U.S. oil infrastructure, CSU found.

If a major hurricane knocks refiners offline, gasoline prices could rapidly spike 50 cents a gallon for a month or two before returning to normal, De Haan said.

“Anyone traveling or planning a late-season road trip needs to be watching the Gulf of Mexico and watching the Atlantic because we’ve seen profound impacts from hurricanes on refiners before and that’s a worry for the closing innings of summer,” he said.