Gas cost lowest since 2011

NEW YORK — Americans are paying the least to fill their cars in almost two years as refiners process the most crude in a decade, offering some relief to nervous consumers.

The national average retail price sank 1.1 cents to $3.211 a gallon, the lowest since Dec. 20, 2011, AAA, the nation’s largest motoring club, said Friday. Pump prices are approaching the lowest level since February 2011, just before unrest in the Middle East pushed U.S. crude oil above $100 a barrel and gasoline near $4 a gallon.

“We’re probably just a few days away from seeing the cheapest gas prices since February 2011,” said Michael Green, a AAA spokesman in Washington. “Our official estimate would still be that we’re going to drop to $3.10 a gallon by the end of the year. At the rate we’re going, it wouldn’t be surprising if we even go a little lower.”

GasBuddy.com reported Friday that ARCO, Costco and Safeway in Everett were all offering regular gas for less than $3 a gallon.

U.S. refiners are processing the most crude and other feedstock for this time of year since 2003, having expanded to take advantage of surging domestic and Canadian supply. U.S. oil production grew in October to the highest level since March 1989 as advances in drilling techniques boosted output from shale formations.

If prices fall to AAA’s year-end target, that 11-cent drop will save the average driver about $1.24 each week, or $64.31 annually, according to data from Michael Sivak of the University of Michigan’s Transportation Research Institute.

Retail prices have fallen 38.3 cents since August, with the 2013 Atlantic hurricane season that ends Nov. 30 shaping up to be the first in almost two decades without a major storm disrupting Gulf Coast crude and fuel production.

West Texas Intermediate crude prices on the New York Mercantile Exchange have fallen 12 percent and gasoline futures on the Nymex have dropped 16 percent since August.

“The ongoing purge that we are seeing in prices at the pump is of course reflective of what we’re seeing in the wholesale markets, and we’ve had a nice pullback on crude oil prices,” said Stephen Schork, the president of Schork Group Inc. in Villanova, Pa. “We’re now kind of at the nadir of demand.”

Crude traded in New York jumped 35 percent to $113.93 a barrel April 29, 2011, from $84.32 on Feb. 15 of that year on concern unrest in Libya would spread and reduce supply from the Middle East. Pump prices surged 85.2 cents to $3.985 a gallon in early May 2011 from $3.133 in February.

About 19 percent of gas stations were charging less than $3 a gallon Thursday, with only 2 percent selling regular for more than $3.75, according to AAA’s Green. Drivers in 38 states had access to at least one station selling the fuel for below $3.

“There hasn’t been a major hurricane disruption, refineries have run smoothly and there’s more refining capacity in North America,” Green said. “We’re also looking at a time when you generally see declining demand, a drop in the cost of oil and a switch to less-expensive winter blend gasoline.”

More in Herald Business Journal

Snohomish County’s campaign to land the 797 takes off

Executive Dave Somers announced the formation of a task force to urge Boeing to build the plane here.

A decade after the recession, pain and fear linger

No matter how good things are now, it’s impossible to forget how the collapse affected people.

Under cloud of ethics probes, Airbus CEO Enders to step down

He leaves in 2019 after 14 years. Meanwhile, aircraft division CEO Fabrice Bregier leaves in February.

For modern women, 98-year-old rejection letters still sting

In a stark new video, female Boeing engineers break the silence about past inopportunity.

Drone’s ease piercing of NY ‘no-fly’ zone underscores risks

An Army Black Hawk helicopter suffered damage to one of its rotor blades, but was able to land safely.

Tax reform needs the public’s input on spending priorities

The GOP tax plan is a good idea, but the next step should give us a voice on how taxes are spent.

Commentary: GM, Boeing fight a war of words over Mars

Boeing is strongly signaling how crucial deep-space exploration is to its future.

US prosecutors move to cash in on $8.5M in seized bitcoin

The bitcoin cache was worth less than $500,000 when a suspect was arrested on drug charges.

Disney buying large part of 21st Century Fox in $52.4B deal

Before the buyout, 21st Century Fox will spin off the Fox network, stations and cable channels.

Most Read