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LI gas prices slip to lowest since November

Jimmy Carl, of Baldwin, puts gas in his

Jimmy Carl, of Baldwin, puts gas in his truck on Oct. 8, 2014, at the Shamrock gas station in Baldwin. Photo Credit: Newsday / Alejandra Villa

Gasoline prices have slipped to a new low for the year on Long Island.

The main reasons are falling crude oil prices and slowing demand for fuel with the end of the summer driving season.

The cash price for regular gas dropped to an average of $3.596 a gallon in Nassau and Suffolk counties on Saturday, said the AAA motorist group. That is just below the previous low of $3.60 on Feb. 3.

Wednesday morning the average slipped a bit further, to $3.576 -- the lowest since Nov. 22, and 46 cents a gallon below the recent high of $4.036 a gallon, reached July 2.

Some industry experts predict further declines at the pumps in coming weeks.

"I think you've got another 10 to 25 cents a gallon coming to you in the next 30 days," said chief oil analyst Tom Kloza of the Maryland-based fuel price information service GasBuddy.com.

Typically, prices fall in October and November, stabilize as holiday-related driving increases demand, then fall to their seasonal lows in January and February.

Decreases this month are being tempered in the Northeast by the unplanned partial shutdown of a refinery in New Brunswick, Canada, which is a key supplier to the region, as well as by routine fall maintenance at other refineries, experts said. "The cheapest numbers are likely to occur when refining production recovers," Kloza said in a statement. "The actual bottom in this current down cycle may not occur until January."

Underlying it all is the falling price of crude, said Andy Lipow, president of Houston consulting company Lipow Oil Associates LLC. U.S. production has risen to a 30-year high of 8.875 million barrels a day. This is largely from the environmentally controversial practice of hydraulic fracturing to extract oil from deep shale formations such as the Bakken in North Dakota. Meanwhile, crude oil production in Libya, which has been interrupted by years of civil war, has increased this year more than expected, Lipow said. And the economic news from some nations, including Germany and China, has energy traders worried about a fall-off in global demand for fuels.

"All of these factors have resulted in an oversupplied market perception, and as a result we've seen crude oil prices decline dramatically," Lipow said.

U.S. benchmark crude oil has retreated from a recent high of $107.95 a barrel on June 20 to below $90. It settled Wednesday at $87.31, down $1.54, according to CME Group, after a government report showed stocks higher than expected.

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