Small drop in gas prices expected through June
By Ronald D. White
Los Angeles Times
By Ronald D. White
As the annual hurricane season kicks off today, gasoline prices continue to slip in most of the U.S. — a respite that should last for the rest of June if weather and refinery equipment cooperate, energy industry experts said.
Gasoline prices began rising more than two months ago as oil prices increased, gas supplies shrank and refiners in parts of the nation made a difficult transition to the fuel additive ethanol.
At the same time, refiner profits jumped, particularly in California where a few refineries encountered production problems.
Now, most U.S. refineries have returned to full production after an unusually lengthy maintenance period, and ethanol distribution difficulties in Texas and the East Coast have been resolved.
"June will be a pretty comfortable month for gas supplies around the nation," said Tom Kloza, chief oil analyst for Oil Price Information Service, which tracks fuel markets. "The worst prices should disappear."
Nationally, the average price of a gallon of self-serve regular gasoline fell 2.5 cents in the week ending Monday to $2.867. The latest U.S. average is 77 cents higher than a year earlier.
The average price in Hawai'i yesterday for regular was $3.38, or 85 cents higher than a year ago, according to AAA.
In New York futures trading, light sweet crude oil for July delivery fell 74 cents to $71.29 a barrel yesterday after Secretary of State Condoleezza Rice said the U.S. would join nuclear talks with Iran if that country proved it was no longer conducting uranium enrichment.
In addition, traders were betting that the Organization of Petroleum Exporting Countries, meeting in Venezuela today, wouldn't cut oil production.
Motorists shouldn't expect a significant decline in oil or gasoline prices this summer because of two potentially supply-squeezing forces: the traditional summer car trip, which boosts demand, and what is predicted to be an active hurricane season, which could reduce oil and fuel production in the key Gulf Coast region.
Worries about supply disruptions by weather or international attacks have kept oil and gasoline prices volatile.