Market Commentary and Intraday News
US gas prices trickle lower except on coasts
232 days ago
By SANDY SHORE
AP Business Writer
Drivers on either coast may be questioning the conventional wisdom that gas prices fall after Labor Day.
Motorists in California paid an average of $4.232 per gallon Wednesday. That's 45 cents higher than the national average and exceeded only by Hawaii among the 50 states.
Prices in New York, Connecticut and New Hampshire are at or near highs for the year. They're also about 40 cents higher than a year ago.
Refinery and pipeline problems have shrunk supplies of gasoline on the coasts and driven up prices in states that typically have some of the highest gas prices in the U.S. anyway. In other regions, gas prices have trickled lower after a late-summer surge.
California's gasoline inventories have shrunk to the lowest levels in more than a decade. That has been exacerbated by the state's strict anti-pollution laws which require motorists to use costlier blends of gasoline.
Drivers in the Pacific Northwest also are feeling the pinch. The average price in Oregon and Washington is above $4.
Tom Kloza, chief oil analyst at Oil Price Information Service, expects another dramatic surge in West Coast prices over the next five days before they eventually head lower.
Kloza says conditions are improving on the East Coast, where refinery issues created tight supplies in the past several weeks, mainly in the Northeast. The situation is gradually easing as more imported oil arrives, he said.
For the rest of the country, average gas prices have dropped in the past month, but at a slower pace than typically seen after Labor Day. At $3.78 per gallon, the national average is the highest ever for this time of year.
Kloza expects the broad portion of the country to see prices at $3.50 or lower by Thanksgiving. But the West Coast will be closer to $4.
The price of oil rose 27 percent from late June through mid-September. In addition to the refinery issues on the coasts, the effects from Hurricane Isaac, which disrupted refineries and deliveries of imported oil along the Gulf Coast, lingered into September.
Since mid-September, oil prices have dropped 11 percent _ including a 4 percent drop Wednesday _ largely on concerns about the sluggish global economy. Overall U.S. supplies remain plentiful and demand is anemic.
The cheapest prices for gas, which range from $3.50 per gallon to $3.614 per gallon, are in Texas, the lower Midwest and parts of the South.
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