Gasoline prices down 5.9 cents in California
Pump prices continued to fall in California and much of the nation, a federal report showed Monday, and so did oil prices despite the promise of an OPEC production cut.
California motorists’ average cost for a gallon of self-serve regular gasoline fell to $2.481 on Monday, down 5.9 cents from the previous Monday, according to a weekly survey by the Energy Department. A year ago, the state average was 34.6 cents higher.
Nationally, the price rollback slowed a bit from previous weeks, but the average price was still off 1.8 cents to $2.208 a gallon. That was the lowest average of the year and 39.5 cents below the year-earlier level, the Energy Department said.
Pump prices peaked at $3.069 a gallon in September 2005, after hurricanes Katrina and Rita damaged Gulf Coast refineries and shut down fuel pipelines.
“Most of the forces that brought prices lower over the past few months are still in play. Demand is down from the summer months. There is ample supply. The hurricane season is almost over,” said Carol Thorp, a spokeswoman for the Automobile Club of Southern California.
However, Thorp added, “any little glitch could send prices higher.”
Los Angeles saw its gas price average decline to $2.467 a gallon, down 6.7 cents, the Energy Department said. In San Francisco, the average was $2.449 a gallon, down 6.5 cents.
The biggest decline was posted in the Rocky Mountain region, where the average dropped 6.2 cents to $2.352 a gallon. Gasoline prices rose only in the Midwest, where the average increased 1.8 cents a gallon to $2.147 a gallon.
Even so, a gallon of gasoline could be had for less than $2 in parts of the Midwest and the South. Fuel was selling for as little as $1.88 a gallon at a Speedway station in Stow, Ohio, and $1.85 a gallon at a Quik Trip gas station in Atlanta, according to Gasbuddy.com.
The average price of diesel fuel increased 2.1 cents to $2.524 a gallon, the first increase in 10 weeks but down 63.3 cents from a year ago. In California, the average diesel price fell 3.4 cents to $2.669 a gallon, which was 48.3 cents lower than a year ago.
Diesel prices increased in most states because of rising demand for distillate fuel, including heating oil.
In New York futures trading, a pledge last week by the Organization of the Petroleum Exporting Countries to cut oil production by 1.2 million barrels a day failed to stem a slide in oil futures prices that began after a record high of $78.40 a barrel was reached in mid-July. December oil futures fell 52 cents to settle at $58.81 on the New York Mercantile Exchange.
“The OPEC announcement was too little too late,” said Steve Bellino, vice president for energy risk management for brokerage Fimat USA Inc. In addition, many traders doubt OPEC’s ability to say united long enough to carry out the reduction, he said.
Bellino said OPEC was also up against what might be another shift in energy futures investing. The “nonfundamental money,” or cash from people who normally did not invest in commodities markets, that helped push oil prices to record levels might be shifting back into the equity market because of the jump in stock prices, he said.
“The sentiment for investing in oil has changed,” Bellino said. “We could go as low as $54 a barrel, but I don’t think that the market will crater. Maybe this is the new equilibrium for oil.”
Natural gas declined 36 cents to $6.881 per million British thermal units. Heating oil dropped 1.1 cent to $1.669 a gallon.