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Gasoline prices fall in California, U.S.

But prices are high for this time of year. And Americans are on pace to pay more for gasoline in 2011 than ever before.

September 27, 2011|By Ronald D. White, Los Angeles Times
  • A driver pulls the nozzle out of his gas tank after fueling up in Augusta, Maine. Nationally, the average price of a gallon of regular gasoline was $3.509, down 9.2 cents from a week earlier.
A driver pulls the nozzle out of his gas tank after fueling up in Augusta,… (Pat Wellenbach, Associated…)

Pump prices are falling in California and the rest of the nation, but they remain so high that consumers are feeling little relief.

The average price of a gallon of regular gasoline in California fell 3.6 cents over the last week to $3.887, according to the Energy Department's weekly survey of service stations. That is a record high for the state for this time of year, when prices usually are sharply lower following the end of the summer driving season. The latest state average is 89.1 cents a gallon more expensive than the year-earlier price.

Nationally, the average price for a gallon of regular gasoline fell 9.2 cents to $3.509. That is the second-highest level ever for this time of year — trailing the $3.718 price recorded in September 2008 — and is 81.5 cents higher than at this time last year.

To some, such as Michael Stell of Foothill Ranch, a drop of a few pennies a gallon simply is not enough to compensate for a vastly changed post-recession reality. Stell lost his job as a master fitness trainer at a well-known national chain of gyms in late 2008. As a security guard, Stell said, he makes about half as much money as he did as a trainer.

At night, at home, he keeps the lights off in all rooms but the one he's occupying. Stell has cut way back on air conditioning and dining out. He's reduced his driving in his Ford Ranger truck and PT Cruiser by more than half to get a cheaper rate on his auto insurance.

For recreation, Stell said he used to ride his Harley Davidson Electra Glide motorcycle about 15,000 miles a year. This year, Stell says he will keep it to 5,000 miles.

"My dad was an Arco distributor, and I know he must be rolling over in his grave about prices like these," Stell said. "It seems like they always shoot up a lot over a few weeks, and then they drop a little bit, and very slowly. I don't fell good about these prices at all."

Americans are on pace to pay more for gasoline in 2011 than they ever have before. Based on prices paid so far this year, U.S. drivers will shell out an estimated $491 billion at the pump, surpassing the previous record of $449 billion in 2008.

"Are the price reductions we're seeing this week going to make Americans drive more? I doubt it," said Fred Rozell, director of retail pricing for the Oil Price Information Service. "Not with stagnant personal incomes and such high unemployment, and gas prices still running much higher than they were a year ago."

Some additional relief may be on the way. Phil Flynn, an analyst with PFGBest Research, said gasoline prices could drop faster and further if Libyan oil returns to the world market by the end of the year. Before the fighting that ousted longtime leader Moammar Kadafi, Libya was exporting as much as 1.65 million barrels of oil a day.

In oil trading Monday, the U.S. benchmark West Texas Intermediate crude climbed 39 cents to close at $80.24 a barrel on the New York Mercantile Exchange, and the European benchmark Brent North Sea crude dropped 3 cents to close at $103.94 a barrel on the ICE Futures Exchange in London.

ron.white@latimes.com

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