Gas prices expected to fall this month

Gas prices expected to fall this month
By Barbara Hagenbaugh, USA TODAY
WASHINGTON — Gasoline prices are expected to continue to fall this month as decreased demand, greater focus on healthy supply levels and a decline in oil prices are leading to lower prices at the pump, the government said Wednesday.
Still, gas prices are expected to be higher than they were a year ago, when the summer driving season unofficially kicks off Memorial Day weekend, the Energy Department said in a weekly report.

"Retail gasoline prices are likely to fall during May," the Energy Department's Energy Information Administration said. "While such a decline will be a welcome relief for gasoline consumers, the outlook remains mostly cloudy, as retail prices are still expected to remain well above last summer's level."

The average price of gasoline has fallen for three consecutive weeks. On Monday, unleaded gasoline averaged $2.235 a gallon, down 4.5 cents from the record high, not adjusted for inflation, hit three weeks ago. But gas prices were still up more than 39 cents, or 21%, from the same time a year ago, according to the Energy Department.

Government analysts said several factors are behind the expected continued price decline:

•Demand. High gasoline prices appear to be dampening demand. Car companies this week reported a softening appetite for large SUVs while more fuel-efficient cars continued to gain in popularity. Sales of Toyota's gas-electric Prius hybrids were up more than 200% in April from a year ago, the car company said.

The American Petroleum Institute estimates gasoline demand is down a half-percent to 1% from a year ago, chief economist John Felmy says. He notes demand was particularly elevated this time last year, making the decline that much more significant.

Steph and Andy Vuong of Arlington, Va., have seen their gas mileage double since they traded in their 1999 Nissan Maxima V-6 for a Honda Civic hybrid at the end of March.

"The hybrid made a lot of sense with gas prices what they were," says Andy, 24, a consultant.

•Supply. As temperatures rise and the snow melts, energy traders are shifting their focus from the low levels of heating oil supplies that persisted through the winter to the high levels of gasoline inventories. That has led to a reduction in prices at the wholesale level. Gasoline inventories at the end of last week were up 4.7% from the same time a year ago, according to the Energy Department.

•Oil. The price of oil accounts for nearly half the cost of gasoline. Oil prices have fallen 12% since hitting a record $57.27 a barrel on April 1. That has helped lead to a decline in gasoline prices.

Increased focus on high oil inventories is partly responsible for the decline in oil prices. As of Friday, oil supplies were the highest in more than three years, according to the Energy Department.

Web Source: http://www.usatoday.com/money/industries/energy/2005-05-04-gas-prices_x.htm

 

I guess we shal find out down the road opcorn:

 

I filled up today and it was $2.11 which is lower than the $2.19 the last time I filled up at the same station.

 

rotfl i have been putting off my vacation to the mountains waiting for diesel to go down :doah:

no chance ill be going anywhere soon