Gas drops 4 cents a gallon on Long Island
Gas prices at a Hess station in Hoboken, N.J. are well below $4 a gallon yesterday. Regular gasoline averaged $3.995 a gallon in Nassau and Suffolk Monday morning. (May 14, 2012) Credit: AP
Gasoline dropped by another 4 cents in the past week to slip below $3.90 a gallon on Long Island.
And in a sign that prices may continue to fall, U.S. crude oil drifted below $90 a barrel in trading Wednesday.
Regular gasoline averaged $3.891 in Nassau and Suffolk counties Wednesday morning, according to a survey done for AAA. The new average is the lowest since Feb. 14, and 27.8 cents lower than the recent peak of $4.169 a gallon on April 10.
Tuesday's average price was 19.2 cents lower than a year earlier. But at this time two years ago, regular gas had just climbed above $3 a gallon.
The AAA survey is based on the lowest price available at stations that charge less for cash than credit card purchases.
Last year, the Long Island average for regular gasoline peaked on May 12 at $4.284 for regular, then fell to $3.541 on Dec. 26, before climbing again.
As gasoline prices have fallen, demand has picked up. MasterCard's latest SpendingPulse report found nationwide demand last week lagged year-ago levels by only 1.1 percent. As recently as early April, demand was trailing year-earlier levels by more than 6 percent.
Meanwhile, U.S. crude and European crude oil -- the latter used to make much of the gasoline sold on the East Coast -- have fallen this month on strong supplies, an easing of tensions over Iran's nuclear program and disappointing economic news here and in Europe, portending lower energy demand.
Further declines may be limited. Market analyst Tom Kloza of the Oil Price Information Service, which surveys prices for the AAA, said world demand still is strong, and huge amounts of investor money are available to prop up oil futures. The OPEC cartel, he said, isn't likely to allow prices to fall much below where they are now without cutting back production.
"I think we'll see modestly lower [gasoline] prices, but not a broad decline," Kloza said.
The record Long Island average for regular in the AAA survey is $4.346, set July 8, 2008.
U.S. crude futures fell Wednesday by $2.94 on the New York Mercantile Exchange to settle at $87.82 a barrel, the lowest settlement since Oct. 21. European benchmark Brent crude fell by $3.21 Wednesday in London trading, to settle at $103.47 a barrel, the lowest settlement since Dec. 16. With Bloomberg
