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Experts expect summer gasoline prices as low as $3.84 in California

April 11, 2013|By Ronald D. White
  • Average gasoline prices of more than $4 a gallon in California are expected to slowly disappear by summertime, dropping to as low as $3.84 a gallon by August.
Average gasoline prices of more than $4 a gallon in California are expected… (Justin Sullivan / Getty…)

Experts are saying American drivers, including Californians, can expect some of the lowest summer gasoline prices they have seen in three years.

Some are predicting a steady decline in California gasoline prices to as low as $3.84 a gallon by August.

This year, the Energy Department is expecting a national summertime average of about $3.63 for a gallon of regular gasoline.

That would be the lowest in three years, down six cents from $3.69 a gallon a year ago and off 8 cents from the $3.71 average in 2011.

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"One reason is the price of crude oil," said Tacred Lidderdale, a senior economist at the Energy Information Administration.

"We expect crude prices to be lower than last year. One of the big reasons is growth in production, particularly in the U.S. and Canada," Lidderdale said in an interview.

Another reason, Lidderdale said, is that gains in fuel economy in U.S. vehicles are expected to more than offset increased driving and higher fuel consumption during the summer months.

The traditional summer driving season in the U.S. starts with the Memorial Day weekend and ends with Labor Day.

If 6 cents a gallon seems like paltry relief, perhaps the bigger picture will ease some of the pain.

Patrick DeHaan, senior energy analyst at the fuel price reporting website GasBuddy.com, said that fuel eats up such a large amount of consumer spending that even a decline of a few cents is like a mini stimulus package.

Compared to last year, "Americans are spending $108 million a day less on gasoline this year than they were last year," DeHaan said.

GasBuddy is predicting that a gallon of regular gasoline in the U.S. will average $3.69 in May, $3.64 in June, $3.73 in July and $3.65 in August.

For California, GasBuddy.com is predicting a steady drop in regular gasoline prices, from an average of $4.08 a gallon in May to $3.99 in June, $3.91 in July and down to $3.84 in August.

Another reason for those lower prices, DeHaan said, was the fact that California and the U.S. have seen few refinery problems in 2013.

The Oil Price Information Service (OPIS), which collects fuel price data daily from more than 100,000 retail outlets, is predicting gasoline prices that, on average, will be 10 to 15 cents a gallon cheaper than last summer in California and the U.S.

"In California, the best news continues to be the fact that refineries there have begun to receive shipments of cheaper crude oil from other parts of the U.S., by train," said Tom Kloza, chief oil analyst for OPIS.

"You won't be buying an HD television with the savings," Kloza said, "but it's looking like a kindler, gentler year for fuel prices."

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