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Gas Prices Subside 2.5 Cents

Feds Fix Miscalculation from Previous Week

By Joe Benton
ConsumerAffairs.com

May 31, 2006
Retail gasoline prices fell 2.5 cents over the last week to $2.87 a gallon and that is the lowest level in six weeks. The decline would be even sharper except for a mistake in calculating gas prices the week before.

Even so, the pump price for regular unleaded gasoline is still 77 cents higher than a year ago, according to the Energy Information Administration's weekly survey of service stations.

The agency revised upward the prior week's national price by almost a penny after receiving incorrect fuel cost information from stations in Los Angeles.

The EIA numbers and numbers reported by AAA differed by more than 15 cents last week. “We got bad numbers reported to us," an EIA spokesman said.

With the correct data in hand, the government revised up the previous week's average price for gasoline in Los Angeles by 15.3 cents, and that pushed up the national average price.

The new survey was delayed in order to incorporate the correct information. This week the average pump price in Los Angeles fell 4.1 cents to $3.34 a gallon. That is still the highest price for gasoline in any city.

The EIA's weekly survey reflects prices at about 800 stations nationwide, including 128 on the West Coast. The agency would not disclose how many L.A. stations are surveyed.

The West Coast suffers from the highest gasoline prices with an average $3.21 a gallon, down 4.4 cents for the week.

The Gulf Coast enjoys the cheapest gasoline at $2.74 a gallon. The Gulf coast average is down 4.6 cents.

U.S. oil companies promise they are doing their best to limit possible gasoline supply disruptions during the 2006 hurricane season.

Government and industry officials warned that consumers should not fill up their cars and trucks with gasoline right before the next storm hits in order to avoid the high fuel prices that would likely follow, because the distribution system could not handle the spike in gasoline demand.

Increased gasoline imports will help make up the loss from storm-related fuel supply disruptions, according to the head of the American Petroleum Institute.

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