Posted on: May 14, 2022, 8:00 a.m.
Last update: May 13, 2022, 6:04 a.m.
Casino visitors to Las Vegas face the highest gas prices in the United States. This could impact visitor numbers and COVID recovery in the gambling capital.
This week’s average in Nevada was $5.12 per gallon for regular unleaded. Diesel fuel hit a record high of $5.47 a gallon, according to AAA. The Nevada average for regulars in March 2021 was $3.10.
Stephen Miller, an economist at UNLV and director of research at the Center for Business and Economic Research, points out that fuel prices are driving up the cost of vacationing in Las Vegas and Reno. This is true for those who drive or fly in cities. Higher costs can mean less travel.
Frequent visitors to Las Vegas or Reno may reduce the number of trips,” miller said Casino.org.
The price is so high that the Las Vegas Metropolitan Police recently warned motorists to watch out for gas thieves during the summer.
Higher prices for holidays
The Las Vegas Convention and Visitors Authority (LVCVA) said it continues to monitor the number of people visiting Las Vegas.
It is premature to know if rising gas prices will impact travel,” said Lori Nelson-Kraft, senior vice president of communications at the LVCVA. Casino.org this week.
But some say these prices could impact how people spend money in Vegas. The current high prices at the pump could impact entertainment plans, according to the Reverend Richard McGowan, a Boston College finance professor who follows the gambling industry closely.
People will definitely have less money for entertainment,” McGowan said Casino.org.
But McGowan warned that regional casinos will be hit much harder than Vegas.
“Given that casinos in New England are essentially regional casinos – where people take day trips to casinos – the price of gas will have a negative impact [these] casinos,” McGowan said.
National Record Award
Nationally, gasoline is up this week by an average of 20 cents from last week, said AAA spokesman John Treanor. Casino.org. The national average price for a gallon of regular unleaded is now $4.43, the AAA reported.
The price of gasoline is “directly related” to the cost of oil, Treanor explained. The various reasons given for the increase include the war in Ukraine, the ban on Russian oil and the reduction in drilling, as well as the cancellation of oil and gas leases in the United States by the Biden administration.
To deal with the impact on tourists, gamblers or even convention attendees, casinos may offer a free tank of gas to out-of-state visitors, or even free parking, said Miller. This would offset the increased transport costs.
Las Vegas economy continues to recover
Rising gasoline prices have hit Las Vegas as its economy continues to recover from the slowdown related to the COVID-19 pandemic.
The number of visitors to Las Vegas remains lower than before the pandemic, Miller said. Reno is in a better position.
Visitor volume has yet to recover to its previous peak in Las Vegas, but remains at around 500,000 in March 2022,” Miller said, citing seasonally adjusted data. “Reno surpassed its previous peak from May to September 2021, then again by 26,000, unadjusted, in March 2022.”
But rather than visitor numbers, many casinos and other businesses are even more worried about filling vacancies, Miller said. Nationally, there are two jobs open for every person looking for a job, he added.
The current economy has also led the Federal Reserve to face a difficult challenge. “That is, can the Fed navigate the narrow path to a soft landing?” Miller explained.
The risk of a US recession is now estimated between 30% and 50%.
“Think of it as landing a fighter jet on an aircraft carrier with a runway that’s too short,” said Miller. “It would be easy to slip off the end of the carrier into the ocean – recession.”