Lower Oil Prices to Affect Gas Stations

Despite more cars on the road, the growth in service station sales will taper off this year, Chapman expects. Gas station sales in the county are projected to reach $1.56 billion, up 3.3%, after surging 8.4% in 1996.

The reason is that gasoline prices are expected to ease. Crude oil prices, which hit nearly $24 a barrel by late last year, are now down to about $19, and gas prices will follow that downward trend, said Esmael Adibi, director of Chapman’s Anderson Center for Economic Research.

But gasoline consumption is still strong, Adibi said, and that’s because the labor market is in overdrive. With more people now employed in the county, he said, cars are getting a lot of use.

“Employment is what drives service station demand,” he said. “If someone is added to the labor force, they have to get to work somehow, and in most cases it’s going to be a car.”

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Patrice Apodaca covers economic issues for The Times. She can be reached at (714) 966-5979 and at patrice.apodaca@latimes.com.