Lower gas prices might be here to stay

 

Eager to capitalize on a recent plummet in gas prices, lines of drivers at local gas stations over the weekend inched their cars toward the pump.

Among the longest lines were at the Speedway at 4261 state Route 43 off of Interstate 76, where traffic was backed up to a nearby highway exit light and unleaded prices were down to $2.93 on Sunday.

“I feel like I can afford food, I can afford just to have fun,” said Robert Gay III, junior public communications major. “I don’t have to worry so much about gas. Gas prices do get outrageously high, and it’s good to see that [they are] down to under $3 right now.”

The decrease in gas prices is primarily due to people driving less in the fall and winter months, an increase in U.S. oil production and a September 15 switch from an EPA-regulated summer-blend gasoline to a cheaper winter-blend alternative, AAA spokesman Michael Green said.

“We generally see demand at its lowest in December or January and its highest in the summer, so this is the time of year when it drops,” Green said.

The situation right now could provide a glimpse of what’s to come, said Justin Barnette, assistant professor of economics. He said gas prices could potentially drop another 10 percent.

The drop in gas prices follows a yearly trend, but prices are expected to fall especially low this year because oil production by refineries in the U.S. is increasing, Barnette said.

U.S. crude oil production in June was at its highest since July 1986, peaking at 8.53 million barrels per day, compared to 8.66 million in July 1986, according to the U.S. Energy Information Administration.

“It really is a supply and demand story, where both of them are moving in a way that’s going to push prices down,” Barnette said. “So you have demand that’s dropping because that happens every fall, and at the same time you have supply increasing because there’s just all this oil.”

The switch to winter-blend gas is a factor that has the potential to decrease prices annually. The summer-blend gas contains different chemicals that prevent it from evaporating in warm temperatures, Green said.

“The evaporating gasoline can cause smog and also can cause vehicle damage,” Green said. “In the winter the weather grows cooler. You no longer need that type of gasoline, and so the EPA no longer requires it.”

Gas prices have an especially important bearing on the lives of students because they generally have less disposable income, Green said.

Emily Diecks, freshman health communication major, and her boyfriend, Austin DiFilippo, a high school student in Pittsburgh, Pa., drove around Sunday looking for the cheapest gas and stopped at the state Route 43 Speedway, where it cost $2.95 for unleaded early afternoon Sunday.

DiFilippo said he will usually fill up on gas when he visits Kent because it is consistently cheaper than in Pittsburgh. Diecks, who is also from Pittsburgh, said she began noticing longer lines at gas stations after moving to Kent. The wait at the pump Sunday, though, which DiFilippo said took about three minutes, was uncommon. But he didn’t mind.

Joanne Williamson, general manager of the Marathon at 4397 state Route 43, said she often sees people from out of town fill up before they head home. She has seen more of them recently, which she said is likely due to the Brimfest festival, but she hasn’t noticed locals filling up more. The gas station had unleaded gas priced at $3.08 at 2 p.m. Sunday.

Still, gas is cheaper in other parts of the country than in Ohio, largely because more oil production methods—such as hydraulic fracturing and horizontal drilling—take place in those areas, Green said. Texas and South Dakota are two states that produce oil in these ways, which in turn produce cheaper gas, Green said. Unleaded gas averaged at $3.16 in Texas and $3.42 in North Dakota Sunday, compared to $3.20 in Ohio, according to AAA’s Fuel Gauge Report.

Ohio’s relative proximity to the Gulf of Mexico, where much of the nation’s gas is produced, explains why it is cheaper in Ohio than in farther locations such as Seattle, Wash., for example, Barnette said.

State gas taxes and the productivity of local refineries also have a bearing on how it is priced, Green said.

Prices are likely to continue decreasing, but it’s still a guessing game, Barnette said.

“I’m playing the same game,” Barnette said. “I’m thinking, ‘Should I get it now? Should I get it next time?’”