Good News At N.C. Gas Pumps As Prices Fall

Posted November 24, 2005 10:58 a.m. EST

— Gasoline supply is up, gas prices are down and the forecast at the pumps for the holiday season is looking positive, but what about the long-term outlook?

"We've seen prices continue to fall rapidly over the past two weeks and I think we'll continue to see them fall in the upcoming weeks," said Gary Harris, a spokesman for the Petroleum Marketers Association. "Demand right now has probably leveled off."

Over the past month, AAA Carolinas says the average price of gasoline has dropped 62 cents, from $2.80 per gallon to the current average of $2.18. Prices are even lower around the Triangle. At an Exxon on Capital Boulevard, prices for regular unleaded were $2.04. And at Dean's Grocery on N.C. Highway 39 in Zebulon, a gallon of gas costs $1.98.

"We're getting a faster recovery in the Gulf and we're also seeing, I think, more action by consumers to conserve," said Mike Walden, an economist at North Carolina State University. "We've seen a big drop off in SUV sales. I think the $3-a-gallon prices really shocked consumers."

People are using less gas, and when they do use it, they are trying to be more efficient. Oil companies are also stepping up production and exploration for new oil reserves.

"I think that within two to three years we could actually be awash in oil in the world and we could see prices come down to perhaps as low as $1.20, $1.30 a gallon," Walden said.

But market watchers caution that another large national disaster, such as another hurricane or an act of terrorism, gasoline prices could quickly rise again.