Shoppers dashing from store to store for Christmas gifts will find a pleasant holiday surprise when it’s time to fill up at the gas station. The price of a gallon of gas has fallen more than 40 cents since Labor Day weekend.
In the Seattle-Bellevue-Everett area, the average for a gallon of unleaded fuel was $1.56 on Thursday, according to AAA. Prices at some stations had dropped to as low as $1.35 a gallon.
Compare that to an all-time record average of $1.97 on Sept. 4.
"With the decline in a lot of vacation travel from this summer, we’re seeing demand weaken and prices fall with it," said Janet Ray, a spokeswoman at AAA’s regional office.
Around central Snohomish County, prices ranged this week from below $1.40 at some Arco outlets to above $1.60 at stations in outlying areas.
While fuel prices fall nearly every winter, it seems more dramatic this year because of the high prices at the end of summer, she said.
Across the state, the average for unleaded fuel was $1.57, about 10 cents above the national average. The statewide average price for diesel fuel was $1.68 a gallon.
While prices may creep upward in advance of Christmas, the holiday usually doesn’t see the same price jumps common around Memorial Day or Labor Day weekends. That’s not necessarily because there’s less travel, Ray said, it’s just that the Christmas travel is spread out over a week or two.
"There is demand. It’s just not as concentrated," she said.
Last year at this time, unleaded gasoline was selling for about $1.38 a gallon, although that was unusually low, Ray said. Not long after Christmas, prices started climbing in advance of the war with Iraq.
While Iraq remains unsettled, it’s not expected to push prices upward. However, don’t expect them to keep falling.
"I don’t think it will go down much more," said Bill Bellman, executive director of the Washington Oil Marketers Association. "Of course, it all depends on what crude prices do."
On Thursday, crude oil prices edged lower, but prices have risen more than 7 percent over the past two weeks. The Organization of Petroleum Exporting Countries agreed earlier this month not to change their production levels. And the federal Energy Information Administration is predicting that U.S. and world demand for oil will increase in 2004.
Combined, those factors are expected to keep gasoline prices in 2004 only slightly below this year’s levels at best, according to the Energy Information Administration.
Bellman’s only prediction for prices in the coming year was that volatility seen recently in the retail gasoline market will continue.
"The result of it is you’ll see these spikes, then it drops back down, like we’ve seen the past few years," he said.
Reporter Eric Fetters: 425-339-3453 or fetters@heraldnet.com.
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