Gas prices drop for 1st time in 4 months

Posted on Mon, Apr. 07, 2003 Associated Press

CAMARILLO, Calif. - Motorists are seeing the first drop in gas prices in four months due in part to falling crude oil prices because of increased certainly about Middle East oil supplies, an industry analyst said.

Gas prices dropped six cents a gallon nationwide over the past two weeks. It's the biggest two-week drop since October 2001, analyst Trilby Lundberg said Sunday.

Another factor was the completion of repairs and maintenance at refineries in advance of spring demand, she said.

The average price for gas nationwide, including all grades and taxes, was about $1.70 a gallon on Friday, according to the Lundberg survey of approximately 8,000 gas stations. That was a decrease of 6.03 cents from March 21, the date of the last Lundberg survey.

It was the biggest two-week drop since the price of a gallon of gas fell 6.6 cents in late October 2001.

Lundberg said gas prices will likely continue to drop in the near term "because world crude oil supplies seem to be more secure now and because U.S. refiners are gearing up to supply plenty of gasoline."

Only a few oil fields have been set ablaze in Iraq and the fires were extinguished quickly, Lundberg said. In addition, Venezuela's oil industry has been recovering from a strike and is back to producing about two-thirds of its pre-strike level.

The price of a barrel of oil was $28.62 on Friday, down from $34.93 on March 17 - the day President Bush gave Saddam Hussein 48 hours to leave Iraq or face war.

The national weighted average price of gasoline, including taxes, at self-serve pumps Friday was about $1.67 for regular, $1.76 for mid-grade and $1.85 for premium.