Experts see LI gas price decline leveling out

Gasoline fell by only a fraction of a cent on Long Island in the past week, suggesting, experts say, that the steady decline since May is over and motorists will be coping for the rest of the summer with prices almost a dollar a gallon higher than a year ago.

"I think what you see now is kind of what you get for most of summer," said chief oil analyst Tom Kloza of the Oil Price Information Service, Retail Division in Wall, N.J. Said Andy Lipow, president of the Houston consulting company Lipow Oil Associates Llc, "I expect prices to be stable or slightly lower."

Both men expect prices to drop in September, however, by 10 to 20 cents a gallon, when the vacation season ends and, for areas like New York City and Long Island, clean air laws no longer require the sale of less-evaporative summer gasoline.

But, they add, all bets are off in the case of an unexpected event such as another sharp spike in crude oil prices or a hurricane that impacts clusters of refineries.

Regular gasoline averaged $3.912 a gallon in Nassau and Suffolk Wednesday, the AAA said, virtually unchanged from $3.917 a week earlier. The new figure represents a decline of 37.2 cents from the recent peak of $4.284 on May 12.

Crude oil, gasoline's chief ingredient, has climbed from the low $90s to the upper $90s in the past two weeks on moderately positive world economic news and, on Tuesday, predictions from several major investment banks that oil prices will rise further next year to as much as $127 a barrel.

Those predictions came despite decisions last month by President Barack Obama and the International Energy Agency to release crude oil from their respective petroleum reserves. U.S. benchmark crude settled Wednesday in New York at $96.65, down 24 cents.

Americans purchased about 1 percent less gasoline last week -- just before the July Fourth holiday -- than in the same week a year ago, according to a weekly survey by MasterCard Advisors.

Home heating oil, still being used by many Long Islanders to produce domestic hot water, has fallen below $4 a gallon for the first time since Feb. 28, to an average here of $3.955 as of June 27 at full-service dealers.

-- With AP

Gallon of Gasoline

(Average per gallon for regular)

Yesterday morning: $3.912

One week earlier: $3.917

One year earlier: $2.950

Source: AAA