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Gas prices take a U-turn as July 4 nears

(Grant Hindsley/ AP)
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With the D.C. region and the rest of the nation poised for their annual let’s-drive-someplace moment over Fourth of July weekend, gas prices have done something alarming: They’ve gone up.

That’s unusual. Most years they peak in June and then drop back down by Independence Day. This time, however, they’ve gone up by eight to 10 cents a gallon, according to AAA, which tracks local and national gas prices. AAA speculates that’s due to troubling events in Iraq that have driven up the price of crude oil.

Right now, the pinch will be felt by the estimated 868,700 Washington-area residents who AAA says will drive more than 50 miles from home during the holiday weekend. Nationally, 41 million people travel during the weekend, with 85 percent driving.

If higher prices continue through the summer, American Express estimates that 75 percent of Americans planning a summer vacation will feel the bite. The credit card and travel company says about 70 percent of those vacationers will travel in the United States this year, a 5 percent increase over 2013.

American Express said the Fourth of July weekend eclipses Memorial Day and Labor Day as the most popular summer weekend for travel.

Those who drive this weekend can expect the highest holiday weekend gas prices since Independence Day 2008, AAA said. Nationwide, the average price of gas is about 20 cents a gallon higher than the average last year, when it was $3.49 a gallon.

As of Monday, the average price of a gallon of gas was $3.91 in the District, $3.69 in Maryland and $3.48 in Virginia.

Maryland, which increased its gas tax last year to pay for transportation needs, has the region’s highest gas tax rate, AAA said. Virginia, which restructured its approach to transportation funding and reduced its tax on fuel, averages almost 10 cents less, the auto club said.

“Maryland motorists are spending more of their incomes on state fuel taxes than their counterparts in Virginia and Washington, but in a saving grace, less than the national average,” said Lon Anderson of AAA. “The current fuel tax rate in Maryland is now nearly 10 cents higher than it is in Virginia, which enacted a new tax formula the same day, and it is 3.5 cents more at Maryland filling stations than it is at the pump in Washington.”

Maryland bumped up its gas tax by about 3.5 cents per gallon a year ago to 27 cents. Virginia and the District also changed their fuel taxes. With gas tax revenue steadily declining nationwide, Virginia was the first state to abandon the conventional cents-per-gallon fuel tax, switching to a percentage tax based on the wholesale price of gasoline. The AAA said drivers in Virginia are paying 17.28 cents per gallon in state excise taxes on gas.

The 18.4 cent federal tax on gas, which Congress is contemplating increasing for the first time since 1993, brings the total tax on drivers in Virginia to 35.68 cents per gallon, which AAA said is the fifth lowest in the nation. In the District, drivers pay 23.5 cents per gallon for gas, or a total of 41.9 cents per gallon with the federal tax

Nationally, state and local taxes add an average of 31.5 cents to the cost of a gallon of gas.