Local News

Economic woes pushing down gasoline, natural-gas prices

Posted November 10, 2008 1:06 p.m. EST
Updated November 10, 2008 6:51 p.m. EST

— Economic woes have brought at least one benefit to drivers: dramatically falling gasoline and natural-gas prices.

AAA Carolinas reported that Triangle drivers were paying $1.77 less a gallon Monday than they were when hurricane damage to Gulf Coast oil facilities drove prices up to an all-time state record of $4.08 on Sept. 15.

But much of the drop has come over the past month.

On Oct. 10, a gallon of regular unleaded gas cost $3.74 in the Triangle; on Nov. 10, the average was $2.29. State gas prices have also dropped from $3.60 to $2.27 in the past four weeks.

Gas went for $1.97 a gallon Monday at a Sheetz gas station on New Bern Avenue in Raleigh and at the Murphy Express in Zebulon.

"I have to work everyday, going back and forth, and it burns up a tank of gas real fast, so it definitely helps the budget, keeps more money in the pocket," motorist Wayne Ruey said.

"It is great to see the big drop," driver Ann Wagner said. "We can go on vacation now and not worry about it. ... But $4, to me that was like price-gouging."

Natural gas prices have been falling, too, and utilities have dropping their prices along with them. Rocky Mount utility officials said they have enacted rate cuts for the past two months.

"We went down a little over 5 cents the first of October, and we decreased our rate another 12 cents the first of November, because the price of natural gas has gone down in the market," Rusty Owen, Rocky Mount's utilities manager, said.

PSNC twice lowered its prices in October at a combined rate of 20 percent for residential users.  Piedmont Natural gas also decreased its rates by 16 percent.

Will the drop continue?

The gas-price drop is, in part, a direct result of the economic downturn, according to AAA Carolinas. As Americans' economic concerns have increased, the demand for gas has declined – also pushing down the price.

Market turmoil has also driven away speculators who were pushing up the price of oil futures, AAA officials said.

Nationally, drivers were paying an average of $2.24 a gallon Monday – a 45 percent decrease since the national record was set on July 17. Then, speculation helped drive oil prices over $140 a barrel, but on Monday, the cost settled at $62 – approximately 55 percent less.

The decrease in gasoline and natural gas prices leaves consumers with one question: Will it continue?

"I don't know. I'm kind of worried it is going back up," Ruey said.

Utilities officials warned that with the cold winter months coming up, customers should not expect natural gas prices to keep dropping.

"We still encourage you to conserve, because we don't know what the price is going to do," Owens said.

AAA officials, however, said they expect prices at the pump to keep dropping.