CAMARILLO, Calif. — Gasoline prices fell an average of 3 cents a gallon nationwide during the past two weeks to their lowest level in nearly three years.
But motorists shouldn't expect the trend to last much longer.
Pump prices could bottom out as early as January as retailers try to halt sliding profits, oil prices continue to rise, and the major oil producing nations implement an expected production cut, said Trilby Lundberg, an industry analyst, in a report issued Sunday.
Prices have fallen for the past 15 weeks, tumbling a total of 44.61 cents a gallon since Sept. 7, when the national average weighted price for all three grades was $1.56 a gallon. On Dec. 21 the weighted average was $1.12, according to the national Lundberg Survey.
In March 1999, gasoline averaged $1.08 a gallon, unadjusted for inflation.
A number of factors beyond the price of crude are in play. First, there's an unusual glut of gasoline on the market. Second, the weaker economy is forcing gas stations to compete more heavily for drivers' business. In many cases, station owners have cut their retail prices faster than their wholesale costs have come down, squeezing their own profit margins.