Chattanooga area gas prices could fall below $3 a gallon this fall

Chattanooga area gas prices could fall below $3 a gallon this fall

August 5th, 2014 by Dave Flessner in Business Around the Region

BY THE NUMBERS

• $3.13: Average price per gallon of regular gas in Chattanooga Monday

• $3.32: Average price per gallon of regular gas in Chattanooga a year ago

• $3.50: Average price per gallon of regular gas nationwide on Monday

• $3.62: Average price per gallon of regular gas nationwide a year ago

Source: AAA Fuel Gauge survey

Gas prices tile

Photo by WRCB-TV Channel 3 /Times Free Press.

Gas prices fell last month by the biggest amount of any July in six years and could cut local gas prices below $3 a gallon by this fall, if current trends continue.

AAA's daily fuel gauge survey of area service stations showed gas prices in Chattanooga fell another penny per gallon on Monday to drop nearly 19 cents per gallon below year-ago levels. Chattanooga gas prices also averaged 37 cents per gallon below the U.S. average on Monday.

Chattanooga motorists were paying about 30 cents a gallon more for fuel ahead of the July 4th weekend just a month ago, but oil and gas prices have plummeted since as concerns about an Iraqi or Russian cutback in oil output have eased and summer demand for gas has remained below initial projections.

The average price per gallon of gas in Chattanooga was $3.13 on Monday. But at least two area service stations -- Sam's Club on Lee Highway and Lottery Food Mart in South Pittsburg -- were selling gas Monday for just $3 per gallon, according to GasBuddy.com

GasBuddy analyst Gregg Laskoski said he's "cautiously optimistic" that gas prices will continue to edge downward as fall approaches, barring a major hurricane or a disruption of current refinery production.

"Oil prices decreased dramatically (last week), so there's no reason gas prices should go up any time soon," said Mark Jenkins, spokesman for the AAA, the Auto Club Group. "In fact, if these conditions continue, prices could eventually slip below $3 a gallon by the end of the year. However, unexpected refinery outages, a spike in oil prices or the mere threat of a hurricane in the Gulf of Mexico could cause gas prices to rise."

Mike Dupree, president of petroleum wholesaler Dupree Oil Co., said wholesale prices vary on a daily basis and some of the discount gas station prices he has seen are less than what the delivered pipeline price is in Chattanooga.

But the trend in recent weeks has clearly been downward prior to Monday when oil prices rose for the first day in a week. Benchmark U.S. crude oil rose 41 cents to $98.29 a barrel on the New York Mercantile Exchange Monday.

Contact Dave Flessner at dflessner@timesfreepress.com or at 757-6340.