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Expect gas prices to come down some

TRI-COUNTY AREA—As Memorial Day approaches, Schuyler, Steuben and Yates County motorists can expect to actually see gasoline prices fall rather than increase. Gas prices calculated last week Monday, May 10 by the New York State Energy Research and Development Authority (NYSRDA) already showed a two cent drop in the average cost per gallon since Monday, May 3.
This decline is predicted to continue gradually over the next several weeks and could fall as low as $2.91 per gallon by Memorial Day. “Retail prices will be tumbling down, but we cannot know how much or exactly when,” Trilby Lundberg of Lundberg Survey Incorporated (LSI) independent market research company said.
According to the NYSRDA, the average cost of gas for Upstate New York on May 10 was $2.99 per gallon, and the week before on May 3 it was $3.01. Last week, Schuyler County averaged $2.99, Steuben County averaged $3.01 and Yates County averaged $3.02 per gallon.
Just a few months ago, the U.S. Energy Information Administration was predicting gasoline prices to rise above $3 a gallon by Memorial Day. Now, however, energy research experts say gas prices have peaked just below the $3 mark. “While not guaranteed, the likely trend for dropping oil prices means the national average may not reach the $3 mark all summer,” Lundberg said.
Over the past year, gas prices in the area have fluctuated, but stayed in the high two dollar range. According to motorist group AAA for Central and Western NY, the average price for a gallon of unleaded gas is 10 percent higher now than it was in January and it is 40 percent higher now than this time last year.
Last year at this time the average gas prices for the area were only $2.36 per gallon, which is a 26.6 percent increase in change. In 2008, however, gasoline prices were all the way up to $3.97 per gallon, which is a 38.7 percent decrease in change.
According in Mark Williams, AP energy writer, wholesale gas prices have begun to decrease by 25 cents a gallon to $2.19 per gallon since last week. This 10 percent decline is a result of rising supplies and concerns about the global economy.
“In general, gasoline prices in the spot and futures markets have been relatively robust. Production of gasoline has been profitable for the industry,” said Gianna Bern, president of Brookshire Advisory and Research, who focuses on energy economics research.
As of April 30, the U.S. had 225 million barrels of gasoline stored, which is five percent more than they had a year ago.
The European debt crisis has increased as a result of confidence lowering in global economic recovery, which forced analysts to also lower their energy demand predictions. The violence and tensions in oil-producing nations like Nigeria and the Middle East has also slowed lately.
According Lundberg, demand for gasoline is also down because of high unemployment rates and related reductions in driving.
This drop in gas prices is good news for area motorists who have been preparing for an increase in gas prices for their summer travel. “I’ll be able to eat at more expensive restaurants, go a little farther, and be able to go to more places that originally planned,” Deb Dailey, a Yates County resident, said.
Many are still skeptical that this is the highest price range for gas this summer. In fact, Economist Ken Mayland of ClearView Economics suspects most drivers will view the lower prices as temporary and they’ll pocket the savings.
“My family and I have planned a couple of trips this summer. We are planning to rent a vehicle that gets better gas mileage for a 12-hour trip to Maine, which is very upsetting. I just wish the prices were back down to at least under $2, but at this point I will be happy if they just stay under $3,” Cheri Perry, a Schuyler County resident, said.
Even though gas prices are falling, it is not predicted to have a significant impact on overall consumer spending or economic growth. It will save Schuyler, Steuben and Yates County residents’ money at the pump, though.
 





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