Oil prices drop, but gas could be slow to follow
Posted August 15, 2011 9:41 p.m. EDT
Updated August 15, 2011 11:51 p.m. EDT
Raleigh, N.C. — 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.
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."