Gas prices continued their slow summer slide last week, providing some relief for New Jersey motorists planning travels on Labor Day weekend. But the trend comes despite certain fundamentals that an analyst said could trigger upticks in the coming days.
The average price for a regular gallon of gasoline fell 1.9 cents last week, to $3.42 a gallon, according to a GasBuddy survey of 3,525 stations in New Jersey. That marks a 15.5-cent drop from one month ago and a 20.9-cent drop from a year ago.
The results are similar to figures released by AAA Mid-Atlantic, which today reports the New Jersey average today is $3.45, down from $3.66 one year ago.
But GasBuddy.com senior analyst Patrick DeHaan said that trend could change this week light of declining gasoline inventories.
The Energy Information Administration reported last week that gasoline stocks declined 1.4 million barrels, to 218.4 million, dropping to their lowest level in about three months and exceeding expectations.
"That was a likely a culprit for a late-week rally in gasoline futures and spot prices, which in turn may mean that as this week wears on, gasoline prices could start showing some upward movement," DeHaan said.
But DeHaan added that any spike is likely to be short lived, given the impending end of summer driving season. AAA also said that despite the drop in inventories, supplies are still considered comfortable.
The generally softer gas prices come even as crude oil continues to trade above $100, closing Friday at $106.18. AAA attributes the trend to positive economic data coupled with continued tension in the Middle East.
The travel organization cited rising manufacturing activity in the United States and China, falling unemployment in the United States, and increased business activity in the Eurozone as reasons for rising crude prices. These factors signal higher demand for fuel while violence in Egypt, Libya and Syria continues to impact oil prices, AAA said.
Rising crude trends normally filter down to the pump, but that hasn't happened this year. DeHaan said mitigating factors such as rising domestic oil production and the absence of refinery problems this year likely contributed to the quiet summer in most of the country.
AAA spokeswoman Tracy Noble said prices increases are possible in late September, when refineries switch to winter blends. Plus, the onset of hurricane season could trigger spikes if damage results in refinery shutdowns or disruptions to supply chains, she said.
AAA said the national average for a regular gallon of gasoline was $3.54 on Friday. That marked the lowest price for that calendar date since 2009, though AAA said the current national price still only trails the record high of $3.69 recorded in 2008 by 15 cents.
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