Thursday, March 30, 2000
Gas prices will fall, U.S. says
But analysts doubt drop will be soon
BY H. JOSEF HEBERT
The Associated Press
WASHINGTON — Motorists coping with high gasoline prices might not see lower pump prices for months as a result of OPEC's increased oil production. Even then, cheaper gasoline might not come in time for the busy summer driving season.
But Energy Secretary Bill Richardson said Wednesday he is convinced the new production levels will offer gradual and modest reductions in prices this summer.
|
PRICES DOWN HERE
|
In the Tristate, gasoline prices appear to be moderating.
Tom Kloza, editor at Oil Price Information Service, a New Jersey firm that tracks gasoline prices, said prices have come down in the Midwestand have probably crested for the time being. It's unlikely that there will be any further major price rollbacks for several months, he said.
Almost a month ago, prices for regular, self-serve unleaded hovered around $1.50 a gallon locally; now, they're about $1.30 to $1.35.
|
He also dismissed as “flat wrong” assertions by some congressional Republicans that OPEC's decision Tuesday was too modest to seriously influence prices.
The department's own statistical agency estimates that gasoline, now averaging $1.55 a gallon nationwide, likely will cost about $1.42 per gallon by summer's end. Mr. Richardson believes those projections are conservative and he cited prices on the futures market that suggested wholesale gas prices would decline as much as 15 cents by July.
The Organization of Petroleum Exporting Countries agreed to increase production by 1.7 million barrels a day and other producers were expected to expand production as well to fill a 2-million-barrel-a-day shortfall that has tripled crude prices over the last 14 months.
Industry officials and analysts said Wednesday it may take six to eight weeks for the additional oil to reach U.S. markets and it is not certain that the lower prices will be passed through immediately to consumers.
The full impact on prices probably will not be felt until gasoline from the lower-priced crude oil moves into the retail market, he said.
Industry experts said there remains uncertainty about exactly how much additional oil will be put into the market since OPEC producers for some time have been exceeding their official quotas by as much as 1.2 million barrels a day. That would mean the decision reached late Tuesday by 10 of the 11 OPEC countries actually would make available only an additional 500,000 barrels a day, analysts said.
After first refusing to join its OPEC colleagues in the agreement to increase oil production, Iran reversed course Wednesday, saying it will pump more to keep other producers from taking away its market share.
Banker, school reformer Clement Buenger dead at 73
Buenger Commission's impact still felt
P&G faulted for lack of info
Delta connectors to buy up to 500 jets
Downtown loses a bit of sole
Gas prices will fall, U.S. says
Dole decides against selling
Suit against Boeing to trial
TRISTATE BUSINESS SUMMARY
INDUSTRY NOTES: REAL ESTATE
COMMERCIAL REAL ESTATE
TRISTATE MARKET SPOTLIGHT
