Photo by Roger Nomer
Globe Staff Writer
JOPLIN, Mo. —
For a while there, it looked like gasoline would reach $3 for a gallon of regular, and it still might, but the chance of that happening is less likely today than it was even a few days ago.
When Darrell Greenwood was told that the $2.75 per gallon price he had just paid for gasoline could be the highest this summer, Greenwood said, “That would be good.’’
Greenwood, with Lloyd Greenwood Plastering Co., of Carthage, said the business has seven trucks on the road all of the time.
“I buy a lot of gas,’’ he said. “You can see it in your bottom line when gas goes up 10 cents a gallon.’’
Rite of spring
Like a rite of spring, gasoline prices typically shoot to their annual highs right about now because of increased demand and because more expensive blends are produced to meet anti-pollution requirements. But instead, they are falling and could fall even more because of declining crude oil prices and economic uncertainty in Europe, particularly Greece, according to analysts.
In addition, crude-oil inventories are running above the upper level of the average range for this time of year, according to recent data released by the Energy Information Administration.
The average price nationally for a gallon of unleaded regular gasoline Friday was $2.92 a gallon, according to the Oil Information Service, which tracks gasoline prices for AAA. That’s down almost a penny from Thursday, but a gallon is still running about 78 cents higher today than a year ago.
The Energy Department and a number of analysts expect average retail gasoline prices to top $3 a gallon by summer. But other analysts say it is conceivable that motorists next month might pay less than they paid at this time a year ago when retail prices topped out at $2.70 or so a gallon for regular.
Crude drops
Gasoline is refined from crude oil. Tumbling crude prices can make it more affordable to fill up your tank. Crude prices have dropped almost $12 a barrel from an 18-month high on Monday. On Friday, a barrel of benchmark crude fell $1.88 to $75.23 on the New York Mercantile Exchange. That’s the lowest per-barrel price since mid-February.
Mike Right, with AAA of St. Louis, said, “I don’t think we’ll hit $3 a gallon anytime soon in Missouri. There are some good signs on the horizon that these prices will hold, and keep us in good stead for the immediate future both in crude oil and gasoline.’’
Stable and lower fuel prices this year could lead to improved travel this year when compared with 2009, he said.
“Early indicators, such as airline passenger counts, are up over last year,” he said. “There has been an uptick in demand for fuel and that shows the economic recovery is occurring. Travel will be a part of that.’’
If gasoline is 80 cents a gallon more than at this time last year, it might cost an additional $12 to fill up your tank.
“That’s only a few dollars,” Right said. “It’s almost insignificant in the overall cost of your vacation travel.’’
Ron Leone, with the Missouri Petroleum Marketing and Convenience Store Association, said, “What we are seeing now is typical for spring as summer demand goes up. We also switch from winter grade to summer grade fuel. It happens every year and that tends to drive prices up.
“After this initial increase, it will flatten out in June and July, the height of the summer driving season. But that could change with the hurricane season, a pipeline break or an international issue.
“We’ll probably hit $3 a gallon some time this summer, but it’s hard to say when and how close we will get. If it does, it won’t stay there long,’’ he said.
The Associated Press contributed to this report.
Crude oil prices
Energy analysts say crude oil prices have doubled in the past year as various economic indicators suggest the Great Recession is over and that energy consumption will improve, especially in emerging markets such as China and Latin America. But the trend could go the other way as economic uncertainty grips Europe and the United States continues to show weak demand for fuel, according to the Oil Information Service.
