Gasoline costs continue to fall nationwide
The average retail cost of gasoline continued to ease in California and dropped back below $3 a gallon nationwide over the last week, a federal survey showed Monday.
After several weeks, however, the downward swing is starting to slow, and experts see gasoline prices leveling off in the coming weeks -- barring a major hurricane or refinery mishap.
“We’ll probably ease just a little bit more, and that’s going to be it,” said Tom Kloza, chief oil analyst at the Oil Price Information Service in Wall, N.J. “You’re likely to see prices within a nickel of where they are now.”
In California, gas stations were selling self-serve regular for an average of $3.192 a gallon Monday, down 4.4 cents from the previous Monday, according to the Energy Department’s latest weekly fuel-price report. The dip was the seventh straight weekly decline since gasoline prices set a record-high average of $3.461 a gallon May 7.
A growing number of California stations are selling regular for less than $3 a gallon, and the lowest-cost fuel was being sold for $2.84 and $2.85 a gallon at a pair of independent outlets in West Sacramento, according to price-tracking website Gasbuddy.com.
Some Chevron, Shell and 76 stations were charging customers in Fairfield, Benicia and Goleta from $3.64 to $3.75 a gallon for self-serve regular -- creating an unusually large statewide price gap of more than 90 cents a gallon, according to the Gasbuddy listings.
Nationwide, the average cost of gas fell 2.7 cents in the last week, to $2.982 for a gallon of self-serve regular Monday. The U.S. average peaked at $3.218 a gallon May 21, according to the federal weekly survey.
Analysts say the lower prices reflect improved gasoline output at U.S. refineries, which had been struggling with production amid unplanned outages. The problems cut into fuel stockpiles ahead of the peak summertime driving season.
Andrew Lipow, a Houston-based industry consultant, said a steady stream of imports -- particularly into California -- has brightened the fuel outlook.
“Inventories are still at the very low end of the range ... but they’re OK if nothing happens,” Lipow said. “The West Coast actually is in terrific shape as far as inventory goes.”
Prices won’t fall much further, though, because traders still worry that fuel supplies will get tight if a hurricane slams into Gulf Coast refineries and that international turmoil could boost oil prices, Lipow said.
The cost of crude oil for August delivery rose 4 cents to $69.18 a barrel Monday, amid news that U.S. oil companies were preparing to abandon production projects in Venezuela. A strike by oil workers in Nigeria was resolved, easing concerns about oil production there.
