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Gas Prices Drop Despite OPEC Cuts

By Joe Benton
ConsumerAffairs.com

October 23, 2006
Gasoline prices are continuing their tumble, down eight cents in just the last two weeks. Prices have fallen 82 cents since August 11 reaching the lowest levels of the year throughout much of the country.

Trilby Lundberg, the publisher of the national Lundberg Survey says the decline is "due to another sizable dip" in the price of crude oil, which continues its fall despite a decision by the Organization of the Petroleum Exporting Countries to cut production by 1.2 million barrels a day.

"The market is doubtful that OPEC will cut that much," Lundberg explained.

The average price of self-serve regular gasoline nationwide is $2.20.

The cheapest gallon of regular gasoline is on sale in Oklahoma City, Oklahoma at $1.81. The most expensive gas is on sale in Anaheim, California at $3.29 a gallon.

Here is a look at some gasoline prices from around the country.

California: In Los Angeles gas prices kept up their unprecedented pace of decline for a ninth straight week, according to the Automobile Club of Southern California's Weekend Gas Watch.

The average price of self-serve regular gasoline in the Los Angeles-Long Beach area is $2.53, which is 6.5 cents lower than last week, 36 cents lower than last month, and 37 cents lower than last year. In San Diego, the price is $2.476, four cents below last week's price, 34 cents below last month, and 46 cents below last year.

On the Central Coast, the average price is $2.795, down 5.8 cents from last week, 32 cents below last month, and 19 cents lower than last year. In the Inland Empire, the average price is $2.495, down 5.9 cents from last week, 38 cents below last month, and 44 cents lower than last year.

"Oil price analysts have observed consumer demand for gasoline shifting upward in response to the price declines, which often triggers higher prices, but instead Southern California prices have continued falling," said Auto Club spokeswoman Carol Thorp.

"Typically, we experience lower prices in the fall because refineries have switched to producing the ‘winter blend' of fuel. This is less expensive to make than the gasoline we use in summer months to comply with air quality regulations."

Texas: Gasoline prices in Texas have dropped again for the 11th straight week, according to AAA Texas Weekend Gas Watch. However, there are some indications that prices may be leveling off.

"The pace of decline in the statewide average price of self-serve regular gasoline appears to have slowed a bit within the last couple of weeks, which may suggest that retail gas prices could be reaching a point of leveling off," AAA Texas spokeswoman Rose Rougeau says.

Still, pump prices have fallen 81 cents a gallon since nearing its record high of $2.92 a gallon on July 28.

In San Antonio, drivers can expect to pay $2.13 a gallon, on average for regular, self-serve. This is 2.2 cents cheaper than last week's average.

Corpus Christi drivers are paying $2.02 a gallon, the cheapest average in the state. El Paso continues to have the highest average on the list at $2.19 a gallon, a drop of six cents.

The statewide and nationwide averages are $2.10 and $2.20, respectively.

Michigan: The average price of regular gasoline in the state is back on the rise, increasing nearly 2 cents over the past week, AAA Michigan said.

The statewide average for self-serve unleaded is $2.18, about 41 cents less than this time last year. The past week's increase followed a drop of 3 cents the week before.

The average price ranged from $2.13 a gallon in the Detroit area to $2.31 in the Traverse City area.

Massachusetts: Gasoline prices dropped three more cents in the last week and are now at their lowest point of the year.

According to AAA Southern New England, the average price for a gallon of regular unleaded is now $2.14.

This is the eleventh straight week drivers have seen prices drop. They peaked on July 31 at $3.04. This is the lowest they have been since the middle of December.

A year ago at this time the average price was $2.57.

The survey found a 33 cent range in prices, from a low of $2.05 to a high of $2.38.

Maryland: Two weeks ago, Maryland quietly passed a milestone that's bringing big relief to motorists.

According to AAA Mid-Atlantic, Maryland gas prices have fallen below the national average and a federal analyst is predicting yet another small dip in the coming weeks.

"The gas prices in the state of Maryland are below the national average for the first time in a year, and Annapolis is below that, so it's an even rosier picture," said John Townsend, director of government and public affairs for AAA Mid-Atlantic.

Prices in the Annapolis region hovered at $2.15 and below. AAA has gas prices averaging $2.18 statewide and $2.20 nationally.

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