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Oil prices drop, but gas could be slow to follow

Posted August 15, 2011

Gas Prices
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— Economists are crediting a tumultuous week on Wall Street for a sudden, dramatic drop in oil prices, but, they say, it may be a while before the savings trickle down to the pump.

According to AAA, gas prices nationwide Monday were at $3.59 a gallon, on average. That's seven cents lower than last week, but 84 cents higher than this time last year. In the Triangle, a gallon of gas was at $3.63 to start the week, five cents less than last week and nearly $1 more than last year.

Spokesperson Troy Green says retailers are slow to slash prices, even when oil prices fall.

"When the prices increase rapidly, retailers will absorb some of those costs to remain competitive, and when they decline rapidly, they'll take their time in reducing costs to try to make up for some of that loss," Green said.

Gas prices Oil prices drop, but gas could be slow to follow

Dorothy Honeycutt, of Dunn, said it costs $70 to fill up her minivan's tank. That amounts to $550 a month, she said.

"It does get me agitated because it takes so much of (my) income for gas," Honeycutt said.

She hopes to see lower gas prices sooner than later, she said. Green said that if oil prices continue on a downward spiral, relief at the pump could begin by Labor Day.

"The kids are back in school, people are back at work, you're no longer taking those summer vacations, and gasoline demand is reduced," he said. "That's usually when we see the price of gasoline decline, in the middle of September."

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  • Rebelyell55 Aug 16, 2011

    We haven't cut our consumption. The next time you're on I-40 or 540, take a look at all the SUVs and people barreling down the road at 80+ mph. Gas prices haven't come down because we don't care how much we pay for it.
    brotherskeeper
    GOLO member since August 1, 2011
    We are not consuming gas at last years rate. I agree it not coming down, because the gas companies have condition the American people on what they should pay for gas. Even the companies who use protrolum products aren't using as much. The price we are paying is what the gas companies think they can get by with. We'll not see gas go down even if the demand goes down. The current prices are the norm now, no more gas below 3.00 anymore.

  • penelope1 Aug 16, 2011

    tayled...I agree with you 100% it's just like the man behind the curtain pulling the strings the wizard of OZ. There are people on wall street etc. that cause a lot of this panic and there isn't a lot we as consumers can do about it especially gas; we have to drive.

  • twc Aug 16, 2011

    Prices sure aren't slow to follow when oil prices rise!! Even the mention that they might rise usually fuels a price increase.

    Want to see the economy boom? Have the government mandate $2.00 a gallon gas maximum price. Subsidize any difference.

    When people and products are moving the economy flourishes. When gas prices went so high some years back that is what exposed all the bank and corporate crooks. Now that some of that is fixed we could flourish again.

    Side note: Listen and understand what Warren Oates said recently. Don't coddle the extremely wealthy! If you don't know what he said, look it up. Google it.

  • Dark_Horse Aug 16, 2011

    "There's a reason there's not a Fiat truck or a VW truck or other European 'pickup' trucks - They are effectively outlawed in Europe and demand for them has been squashed."

    Then why is gas about $10 american there? Its not as simple as fuel efficiency.

  • tayled Aug 16, 2011

    I would look for one of two things to happen. (1) there will be an uptick in the tension in the Middle East; or (2) there will be a major disruption in some large oil pipeline somewhere. Happens every time that gas prices start to dip a little. The conspiracy theorist in me tells me that big oil does this so they can keep their profits jacked up. And answer me this, when the price of oil goes up, the price of gas almost immediately jumps, but when oil falls, it might take weeks to see it at the pump. Sounds like greed to me!

  • brotherskeeper Aug 16, 2011

    Here's why gas prices haven't come down: We haven't cut our consumption. The next time you're on I-40 or 540, take a look at all the SUVs and people barreling down the road at 80+ mph. Gas prices haven't come down because we don't care how much we pay for it.

  • hi_i_am_wade Aug 16, 2011

    "Why not start decreasing the next day?"

    Try running your own business and ask that question again.

    "None of you truly get what is advertised on your vehicles."

    You probably could if we didn't have to buy that accursed ethanol gas. Several times I wanted to write a letter to ncbiofuels.com and ask them how they sleep at night knowing they are (a) encouraging farmers to raise crops to put in gas tanks instead on meal tables, (b) greatly reducing our MPG, and (c) causing our grocery bills to increase significantly because of the first two factors. And now the EPA is calling car companies liars and saying cars would be fine with E-15, as if the EPA knows better than the engineers who made the engine. We need to ban ethanol unless it can be made without wasting farmland and even then we need a choice between ethanol and gas.

  • Rebelyell55 Aug 16, 2011

    This has been proven 100 times over. That lil 4 cylinder car you think is getting 30 miles plus is actually about 19 or 20 mpg. Wake Up!!!
    gvmntcheese
    GOLO member since July 26, 2007
    I've never see any test, or data to back up what your are claiming. Most articles I've read, these numbers are pretty dead on. I've checked mileage in my 4 cylinder cars I've own and had any where from 35 up to 44 mpg. Ford Focus, average, city and highway 42 mpg always and that was with air condition. My 4 cylinder motorcycle only got 38 mpg, but it had a bigger motor than the car did.

  • Rebelyell55 Aug 16, 2011

    They would lose much of their profits selling gas in developing nations since they couldn't rip them off as much as they do us.
    Bill Brasky
    GOLO member since August 19, 2008
    Your right, and that why we have so many refinery here. Gas demands are low now, lower than last year, when gas was cheaper. So it's goes to show that demand does not always drive gas prices, as some companies would like us to believe. It's their profit that drives the gas prices, but they'll put a spin on reason other than that to explain why gas prices are so high. Until the day that gas is not an obsolute neccessity we'll continue to pay high gas prices, and if history repeats the prices we see now will become the norm for awhile yet.

  • WooHoo2You Aug 16, 2011

    None of you truly get what is advertised on your vehicles. This has been proven 100 times over. That lil 4 cylinder car you think is getting 30 miles plus is actually about 19 or 20 mpg. Wake Up!!!-gvmntcheese

    "Wake up???" My straight gas Honda Civic 30 city, 36 highway. (it is easy to figure out) Not sure were you come up with 19 or 20 mpg...

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