US gasoline prices continue to drop
US Energy Sec. Bill Richardson said Tuesday that US gasoline prices have fallen for the fifth week in a row, particularly in the Midwest. 'Crude oil prices have also dipped, but more importantly, stocks are beginning to rebuild,' he said.
Washington, DC�US Energy Sec. Bill Richardson said Tuesday that US gasoline prices have fallen for the fifth week in a row, particularly in the Midwest.
"This is beginning to look like a trend that will benefit the American consumer," he said. "Crude oil prices have also dipped, but more importantly, stocks are beginning to rebuild. There is 3.5 million more barrels of oil on the market since this time last year.
"All of these factors will restore the balance between supply and demand and help sustain economic growth."
Richardson urged Congress to pass tax incentives to increase domestic oil and gas production, alternative energy sources, and energy efficiency.
"It needs to pass the Energy Policy and Conservation Act to give us a workable trigger for a regional home heating oil reserve, reauthorize the Strategic petroleum reserves, pass these tax incentives, and fully fund our energy programs."
Meanwhile, the American Petroleum Institute said Tuesday that gasoline prices continue to follow crude oil price changes.
It said gasoline prices started the year at an average of $1.272/gal for regular in all areas, while crude oil prices averaged $25.55/bbl. Crude oil prices rose to $34.13/bbl on Mar. 7 and gasoline prices rose to $1.529/gal the week of Mar. 20.
Crude oil prices fell to $23.85 on Apr. 10, said API, and gasoline prices fell until they reached $1.420 the week of May 1. Crude oil prices then rose to $33.05 on June 20, and gasoline prices increased to $1.681 the week of June 19. Recently, crude prices have fallen to $28.53 and gasoline prices have fallen to $1.520.
API said, "The sharp price declines of April following the March Organization of Petroleum Exporting Countries meetings have been reversed because crude oil supply and demand conditions remained tight worldwide."
In June, OPEC decided to increase quotas by a combined 702,000 b/d, and on July 3, Saudi Arabia said it would produce 500,000 b/d above its June quota increase.
"We have yet to see these additional volumes on the market," said API. "The US continues to import more than 55% of our petroleum needs and remains at the mercy of world oil markets."
API said requirements for different fuels in different US regions has reduced the flexibility of the US refining and distribution system to respond to unforeseen events such as a pipeline or refinery outages.