National News

September 27, 2013

Gas prices fall as weather, output calm markets

NEW YORK — Gasoline prices have fallen steadily throughout September, and drivers should look forward to even cheaper fill-ups in the weeks ahead.

The national average price for a gallon of gasoline is now $3.42, down from $3.59 on Sept. 1. The price is the lowest it’s been at this time of year since 2010 and is likely to keep falling.

“It’s a layup for me to predict lower prices until Columbus Day weekend,” says Tom Kloza, Chief Oil Analyst at GasBuddy.com and Oil Price Information Service, which tracks retail and wholesale gasoline prices.

Wholesale gasoline prices have fallen faster in recent days than pump prices, so drivers can expect to pay even less as the pump prices catch up.

Gas prices tend to decline soon after Labor Day, but last year they didn’t start going down until mid-October. There are a number of reasons for this fall’s drop in price, experts say:

— Refiners can switch to cheaper blends of gasoline in the winter months as clean-air rules are relaxed.

— Gasoline demand declines in the fall after the summer driving season ends. At the same time supplies rise, because refiners are still making gasoline as they keep operations humming to make heating oil for winter and diesel and jet fuel for shippers.

— This year, refineries have been relatively problem free. There have been no hurricanes, and few unexpected problems at refineries or pipelines, unlike last year.

Even high oil prices haven’t stopped gasoline’s decline. Oil briefly topped $112 in late August as a U.S. threat of military action against Syria made the market nervous about Middle East supplies. The price of oil has since fallen, but remains above $100 per barrel. Still, gasoline has dropped to its lowest price since Jan. 31.

Friday, oil fell 16 cents to close at $102.87 per barrel on the New York Mercantile Exchange.

Last year at this time drivers were paying 37 cents per gallon more than they are this year, on average, because Hurricane Irene and refinery and pipeline problems disrupted gasoline production in August and September. California prices rose sharply in late September, then hit a record $4.67 per gallon in early October.

There are no such problems this year, though California drivers are again paying the highest average price outside of Hawaii and Alaska, at $3.95 per gallon, according to AAA, OPIS and Wright Express.  South Carolina drivers are paying the least, at $3.11 per gallon.

For the year, the national price is on track to average $3.56 per gallon, 7 cents less than last year’s record of $3.63. That would save U.S. drivers $9 billion this year.

Despite the recent drop, the national average is unlikely to fall back to $3.29 per gallon — this year’s low, set in early January — unless the price of oil falls under $100 per barrel, GasBuddy’s Kloza said.

That could happen if tensions in the Middle East don’t flare up again and the hurricane season remains tame. U.S. oil production is expected to hit a monthly rate in October that the country hasn’t reached since 1989. Also, Saudi Arabian exports typically rise in late fall and winter as the country uses less of its oil to generate electricity for air conditioning, pushing global supplies higher.

Jonathan Fahey can be reached at http://twitter.com/JonathanFahey .

 

1
Text Only
National News
  • 10 Things to Know for Thursday

    Your daily look at late-breaking news, upcoming events and the stories that will be talked about Thursday.

    April 23, 2014

  • US weighs clemency for inmates jailed for 10 years

    The Justice Department is encouraging nonviolent federal inmates who have behaved in prison, have no significant criminal history and have already served more than 10 years behind bars to apply for clemency, officials announced Wednesday.

    April 23, 2014

  • High court tosses $3.4M award to child porn victim

    The Supreme Court on Wednesday rejected a plea to make it easier for victims of child pornography to collect money from people who view their images online, throwing out a nearly $3.4 million judgment in favor of a woman whose childhood rape has been widely seen on the Internet. Two dissenting justices said Congress should change the law to benefit victims.

    April 23, 2014

  • Airport security vulnerabilities not uncommon

    For all the tens of billions of dollars that the nation has spent on screening passengers and their bags, few airports made a comparable investment to secure the airplanes themselves.

    April 23, 2014

  • Deal signs bill expanding gun rights in Georgia

    Gov. Nathan Deal has signed legislation expanding where people with licenses to carry can bring their guns in Georgia.

    April 23, 2014

  • Indian film awards arrive in Tampa, Fla., but why?

    The so-called Bollywood Oscars have been held in Macau, Singapore, London — and now, Tampa?

    April 23, 2014

  • Indictment: Prosecutor targeted in kidnapping plot

    A North Carolina prosecutor was the intended target of an elaborate kidnapping plot, but the kidnappers looked up the wrong address on the Internet and abducted the prosecutor’s father instead, according to an indictment released Tuesday.

    April 23, 2014

  • Republican activists push party on gay marriage

    As bans against gay marriage crumble and public opinion on the issue shifts rapidly, some Republicans are pushing the party to drop its opposition to same-sex unions, part of a broader campaign to get the GOP to appeal to younger voters by de-emphasizing social issues.

    April 23, 2014

  • Missouri executes inmate for 1993 farm slaying

    Missouri executed an inmate early Wednesday only a few miles from the farm where prosecutors say he orchestrated the 1993 killing of a couple whose cows he wanted to steal.

    April 23, 2014

  • 10 Things to Know for Wednesday

    Your daily look at late-breaking news, upcoming events and the stories that will be talked about Wednesday.

    April 22, 2014