Further Dip in Gas Prices Seen for the Holidays

Wholesale gasoline prices will continue their recent downward slide during the holiday season, bringing lower prices for motorists at the pumps, a leading oil industry analyst said Sunday.

The national average price of a gallon of gasoline was virtually unchanged over the last two weeks, dropping only about half a cent to $1.005, said Trilby Lundberg, whose publication, the Lundberg Letter, surveys prices every two weeks at 13,000 gas stations across the country.

“We expect cuts at the retail level at many places down the line because the wholesale price has fallen dramatically just this last week,” Lundberg said. “Motorists could see price cuts at the pump in December or sooner.”

Cuts Deeper in West

But, she noted, the dip could start price wars that cut into retailers’ profit margins and prevent them from passing on any wholesale cuts.

“Gasoline retailers, like all businesses, are sensitive to holiday traffic, and where motorists buy gasoline will have a great effect,” Lundberg said. “If price causes customer migration away from a retailer, that is certainly a retailer who may not be able to pass on any cuts he gets.”

At self-service pumps, where most gasoline is sold, as of Friday the price per gallon of regular leaded was 89.43 cents, regular unleaded 92.84 cents and premium unleaded $1.07.

Prices at full-service stations were virtually unchanged, with a gallon of regular leaded going for $115.93, regular unleaded $119.91 and premium unleaded $130.07.

Lundberg said price cuts were deeper in West Coast and Rocky Mountain markets because prices have been slightly higher than the national average in those areas.