Gas Prices Move Even Lower Ahead of Labor Day

by Douglas McIntyre Aug 18th 2011 9:00AM
Updated Aug 19th 2011 11:32AM
The drop in gasoline prices has begun to accelerate, with the cost of a regular gallon declining almost 10 cents in the last month. The AAA Fuel Gauge measured a gallon at $3.58 Wednesday, compared to $3.68 a month ago. At this rate, could prices drop below $3.50 in mid-September, after the end of the Labor Day driving season?

More and more, experts expect that gas prices will move down very sharply after nearing close to $4 earlier in the year. The Wall Street Journal reports that lower oil prices may trigger this. "Somewhere along the line, there will be a 10- to 15-cent drop in gasoline prices," said Kyle Cooper, managing partner of IAF Energy Advisors in Houston. "You have to expect that those prices start to trickle down."

Gas prices could also be pressured down as fewer people drive, undermining demand. Essential trips like commuting to work may not be impacted. But trips to retail establishments, on the other hand, have actually begun to fall. MSNBC reports that Global Insight economist Erik Johnson says gas prices have helped "to fuel the growth in Web-based shopping."

The most profound effect of the drop will probably be in the very populous states where prices are still above $3.71 like California, New York and Illinois. These three states have nearly 70 million residents, or 22% of the U.S. population. Some parts of their states have also been hit relatively hard by the recession. This is particularly true in central California, where some areas have an unemployment rate well above 10%. The same holds true in the upstate region of New York.

Regardless of where you live, the decline is welcome news for the millions of Americans set to hit the road for the Labor Day holiday weekend.

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nthereoff

GAS PRICES AND TOLLS ON BRIDGES ARE KILLING US .I LIVE IN NY TRAVEL TO JERSEY TO VISIT MY SON WHO IS ONLY 37 MILES AWAY AND IT COST ME 21 DOLLARS IN TOLLS AND 20 DOLLARS IN GAS. HOW CRAZY IS THAT? AND ANOTHER TOLL RAISE NEXT MONTH. I CAN SEE WHY PEOPLE ARE LEAVING THE NORTH EAST.

August 22 2011 at 6:58 PM Report abuse rate up rate down Reply
savemycountry911

The Communist Party has endorsed Obama for a second term. Wonder what that will do to gas prices.

August 20 2011 at 8:36 PM Report abuse +2 rate up rate down Reply
Douglas Rehman

Don't get too excited gas should be below $3 dollars now ! going toward 2.50 or less

August 20 2011 at 7:30 PM Report abuse rate up rate down Reply
CATMAN34000

Vote ALL the incumbent politicians out of office at the NEXT election.....starting with the presideny of the united states (obama) ....all the way down to the councilpersons of towns,.

August 20 2011 at 4:31 PM Report abuse rate up rate down Reply
acar098

big deal...this story is a croc. i havent noticed any significant drop in prices. the greed fom the oil companies will keep thye prices at well above $3:50. Then you add the .30 cents in taxes that new york adds and its screw you to the average joe. its disgusting. everything is designed to suck the life out of hard working people.

August 20 2011 at 3:58 PM Report abuse +1 rate up rate down Reply
brhurdle

Can you explain to me why $3.50/gal gas is good news? What has the author been smoking?

August 20 2011 at 1:47 PM Report abuse +2 rate up rate down Reply
jump4life

Why isn't gas just above $2.35 if its at $83 a barrel. Do the math! We are being suckered by the oil companies and the Republican'ts that are in the back pocket of those same oil companies!!

August 20 2011 at 12:59 PM Report abuse +1 rate up rate down Reply
1 reply to jump4life's comment
warrenbent

If gas can profitably be sold for $2.35/gallong, why aren't you doing it?

After all, at $2.35/gallon, you'd sell gas as fast as your pumps could pump it. In the meantime, you'd put all your competitors out of business.

This sounds easier than falling off a log. Are you just too lazy?

August 20 2011 at 6:23 PM Report abuse rate up rate down Reply
acuraec

If you believe for a second that they(oil companies) are doing us a favor in anyway you are absolutely retarded!! We the consumer are being exploited on a daily basis.. This is price fixing and we should be rioting in the streets to take back our country from these corporate vampires who are bleeding us dry all in the name of record quarterly profits!!! It's all about the money!!! Everyone in this country needs to stop watching "reality t.v" and start to wake up and smell the economic slavery most of the people in U.S. are becoming a part of... These big companies are supported by our government with tax cuts while they abuse the environment, create global crisis with oil spills and at the end of the day we still pay the price. This is an outrage!!!! They should be jailed!!! No reason gas should cost more then $250.00 a gallon. If your bored. Do the math... it's simple... search Exxon Mobile quarterly profits for last quarter in 2011. THERE ARE ROUGHLY 90 DAYS IN A QUARTER (3 MONTHS) 24 hrs in a day and 60 minutes in an hour which makes every quarter about 129,000 minutes long. Exxon reported 1st quarter 2011 profits of $ 10.65 BILLION . DIVIDE 10,650,000,000.00 BY 129,000.00.. = ROUGHLY $82500.00 a MINUTE IN PROFITS!! And our government subsidies help these companies avoid paying part of the taxes on these profits. So we get hosed on both ends.. The pump and tax revenue..Your telling me if gas was a dollar cheaper a gallon that this companies future would be in question??. Come on! This is an outrage!!! This is only one global oil company... What about B.P , HESS, SHELL, ECT. People it's time to wake up!!

August 20 2011 at 12:09 PM Report abuse +3 rate up rate down Reply
2 replies to acuraec's comment
warrenbent

You're being exploited daily?

Yet you keep going back for more?

Not exactly the sharpest tool in the shed, eh?

August 20 2011 at 7:28 PM Report abuse rate up rate down Reply
warrenbent

By the way, Exxon's profit margin is a little under 10%, while their return on assets is just over 10%.

What this illustrates is that measuring profits in absolute terms is irrelevant. For example, if I said my investment portfolio generated a return of $1,000 last year, would that be a lot or a little? Well, if I'd invested $100 to generate that $1,000 it would be quite a lot. But if I'd invested $1,000,000 to generate that $1,000 return, it wouldn't be much at all.

In the case of Exxon, shareholders have literally invested tens of billions of dollars. And they're not going to be incented to make such large investments if they can't generate a reasonable return on their investment. And a 10% return on that investment is not out of line. Google's profit margin is 26% for example. And without their sizable investment, you wouldn't have gas.

August 20 2011 at 7:39 PM Report abuse rate up rate down Reply
rockeroll68

You "wingers" absolutely amuse me. When gas and oil spiked during Bush it wasn't his fault...blah...blah...blah. Now it spikes again during Obama and you think you people who wouldn't blame "your President" can blame Obama? The fun of it all is that both parties pay more attention to what the other is saying about them that they forget what they themselves have already said. The rest of us that don't fall on any particular side of "partyism" (my new word for the day) hear and remember the crap that comes from BOTH sides. 2012 is coming and neither party is showing any competence these days. Left blames right...right blames left but no one cares to fix anything Thanks for nothing...ALL OF YOU

August 20 2011 at 12:03 PM Report abuse -3 rate up rate down Reply
pete

We all ranted and raved at Bush. The media pilloried him. In the days of tar and feathers he would have been, then rode out of town on a rail. All because with a barrel of oil at $140 plus gas was $4.35 or so.

BUT -- Bush got on the oil producers and oil companies and told them to figure out a way to bring costs down. He didn't even threaten to open strategic reserve. When a barrel of oil dropped to $100, gas followed and dropped to less than $3.50.

With the current leader of the free world, a barrel barely hit $120 and he allowed gas to go to almost the same price it was when oil was $140 per bbl under Bush.

By the time it dropped into the $80 range, gas was back down to the $2.25 range. I haven't seen less than $3.75 a gallon for more than two years where I live.

The facts are this: when democrats recaptured control of Congress in 2006 spending under Bush increased dramatically. When they took the white house spending skyrocketed. Neither party under Bush paid the slightest heed to his calls - eleven (11) of them - to address the Fannie and Freddie situation. Both parties were and are more interested in keeping their soft jobs, full medical coverage, and kingly pensions. Neither has the slightest concern about the wellbeing of the working class, the country, or anything else unless it benefits them.

40 years of majority in Congress has made generations of democrat politicians feel only they deserve to be there, and they are willing to crap all over the citizenry to get back that control. The best thing that has happened to this country is the Taxed Enough Already party, no matter how much fun the media likes to poke or how many vulgar references they like to make about it. It's long past time for serious contention for control to arise in this country. We can no longer survive with the same-old same-old.

I've worked in central and south Americas, and I've seen poor. They live in shacks, go out into traffic and beg, sleep on the sidewalks and in doorways, hang their clothes on ropes tied between power poles. The doors on their shacks are blankets or rags.

When I hear some "expert" talk about how many millions of "children going to bed hungry every night" I think of THOSE children, most of whom may not have eaten all day. In the U.S. those kids may go to bed hungry, but it's because mom had the guts to tell them, "No more, you've already had six twinkies today." They go to BED, they don't roll up in a blanked on a sidewalk or dirt floor. They have a TV, they have Sega or Wii or Xbox. They live in air conditioned homes. They don't have to look forward to another day of "Shine your shoes, mister?" or "Wash your car, mister?" to earn enough to buy a meal the next day. And they sure won't be digging thru the corner container looking for edibles before the truck comes to empty it.

You people don't know how good you have it, and you keep putting people in power that allow that kind of abuse on YOUR behalf. You should be ashamed!

August 20 2011 at 11:37 AM Report abuse +2 rate up rate down Reply