75° Good Evening
75° Good Evening

LI gas prices cheapest for Labor Day since 2010

On Wednesday, Aug. 27, 2014, the price of

On Wednesday, Aug. 27, 2014, the price of regular gas was $3.59 per gallon at the Sunoco station on Route 25 in Smithtown. Credit: Newsday / John Paraskevas

Long Islanders filling their cars' fuel tanks for trips this weekend will find gasoline at its cheapest price for Labor Day since 2010, and about 30 cents a gallon less than it cost on July 4 -- thanks mostly to lower crude oil prices and high refinery output.

Regular gas averaged $3.739 a gallon Wednesday in Nassau and Suffolk, according to the motorist group AAA -- 14.8 cents less than a year earlier. The local average for gasoline had reached a recent high of $4.036 on July 2.

U.S. benchmark crude oil has retreated from a recent high of $107.95 a barrel on June 20 to about $93. Experts say that decline reflects some weakening of demand in Europe and in developing countries.

It also stems from stronger U.S. production of crude in Western states through the environmentally controversial practice of hydraulic fracturing, which frees oil previously inaccessible in shale.

By pipeline and by rail that relatively low-cost oil is reaching refiners in great quantities. A U.S. government report Wednesday said U.S. refineries ran at 93.5 percent of capacity last week, the highest for that week in at least two years.

Also working in consumers' favor, experts say, is the absence of major disruptions to oil production or shipment internationally, which traders had feared from conflict in Iraq, fighting between separatists and government loyalists in Ukraine and fighting between Israelis and Palestinians in Gaza.

"Gasoline prices are following a very normal decline," said editor Stephen Schork of The Schork Report, an energy newsletter published from Villanova, Pennsylvania. "It's typical to see a peak in July."

Barring the unforeseen, he and other experts expect gasoline prices to continue slipping until mid-November, when they usually rise somewhat from higher demand related to holiday shopping and travel. In about two weeks, the gradual annual switch from summer grade gasoline to less expensive winter grade begins.

"As a consequence, you're likely to see in the second half of September a [gasoline pump] price drop of 10 to 12 cents," said Tom Finlon, the director of Energy Analytics Group Ltd. of Jupiter, Florida, a trading adviser to an energy hedge fund.

Typically, gasoline prices drop again after the holidays as winter weather discourages discretionary driving. This year's lowest Long Island average price for regular was $3.60 a gallon Feb. 3.

More news