If sustained, the trend could save consumers millions of dollars, but could pinch profits at Hawai'i gasoline stations.

From January through June, premium gasoline sales by volume dipped to 20.8 percent statewide, compared with 24.7 percent for all of last year, according to the U.S. Energy Information Administration.

At the same time, sales of mid-grade gasoline increased to 9.3 percent of all gallons sold, compared with 8.8 percent last year. Regular gasoline sales increased 3 percentage points to 70 percent of gallons sold.

The move to cheaper gas comes as gasoline prices statewide flirt with 10-year record highs. The average price of regular in Hawai'i was $2.109 a gallon yesterday. That's below a high of $2.127 hit Monday, according to the AAA travel club.

Industry observers said the rise in prices and the drop in premium sales — which yesterday averaged about 16 cents a gallon more than regular — isn't a coincidence. Buying cheaper types of gasoline is one way consumers cope with high prices, said David Hackett, president of oil industry consultant Stillwater Associates based in Irvine, Calif.

Hackett's firm recently issued a report on Hawai'i's oil industry that recommended, among other things, that the state urge drivers to switch to regular gasoline. Drivers here buy a disproportionately high amount of mid-grade and premium gasoline compared to the rest of the country.

The Federal Trade Commission maintains that few automobiles actually require the expensive grades of gasoline. The agency estimates that Hawai'i consumers could save $7 million a year by buying the proper gasoline for their vehicles.

While premium gasoline has a higher octane rating than regular, there's typically no added performance benefit unless an auto's engine requires the added octane to prevent engine knock, according to the FTC.

Oil refiner Tesoro agreed that the decline in demand for higher-grade gasoline since January is likely a result of higher prices at the pumps.

However, what kind of gasoline is best to buy should be left to consumers rather than promoted by the state, said David Leonard, vice president for Tesoro Hawaii.

"Each motorist needs to decide based on their particular vehicle (which is best), and some people I think prefer to have the higher octane in their vehicle," he said.

Alden Kawamura, a retiree in Kapahulu, said he buys mid-grade gasoline, even though his car could run on regular.

"I've always used it and I'm not planning on changing," he said. "I only fill up once every 10 days or so so it doesn't affect me very much."

Many drivers who do make the switch may not convert back to buying more expensive premium even if gasoline prices fall, said Frank Young, president of the Hawaii Automotive Repair and Gasoline Dealers Association.

Young said those consumer savings likely will take a bite out of gasoline station profits because premium sales generate higher margins. To make up the loss, stations will have to generate more auto service business or convenience store sales, and ultimately may have to raise the price of regular, Young said.

"I bet you at least two-thirds to three-fourths of those customers (that switch) are lost because they got past the perception that they need a premium product in their car," he said.