Regional Gas Prices Drop as Summer Driving Season Starts

24 June 1998

Regional Gas Prices Drop as Summer Driving Season Starts, Says AAA; Lowest June Prices in 4 Years

    SAN FRANCISCO--June 23, 1998--Gas prices have fallen 2 cents in six weeks as the summer driving season shifts into higher gear, AAA reported today.
    "Retail gasoline averages $1.28 a gallon for regular unleaded self-serve in Northern California," said AAA spokesman Paul Moreno. "Prices have not been this low in the month of June since 1994, when the regional average was $1.23."
    Northern California prices are 12 cents lower than one year ago, according to AAA's survey of more than 400 gasoline retailers in Northern California, Nevada and Utah.
    The San Francisco Bay Area average also fell 2 cents to $1.31, which remains 20 cents higher than the national average of $1.11, according to AAA.
    Analysts attribute falling retail gas prices to months of worldwide overproduction of oil, pushing crude prices down to a 12-year low last week. Major oil-producing nations agreed months ago to curtail production in an effort to boost sagging prices, but nonetheless crude prices continued to fall.
    Meanwhile, analysts and traders remain skeptical that further cutback agreements can be reached or even adhered to without cheating, according to Alan Kovski of "The Oil Daily," a Washington, D.C.-based industry newsletter.
    "Oil traders do not expect a quick price recovery, and prices tend to be a reflection of trader opinions," said Kovski.
    Despite the higher demand for gasoline from the summer driving season, demand is still low due to the economic situation in Asia, which means oil supply remains ahead of demand, said Kovski. In Northern California, local averages for regular unleaded self-serve gasoline (change in six weeks) are:

Chico, $1.23 (down 1 cent) Concord, $1.27 (down a penny) Eureka, $1.30 (down 9 cents) Fresno, $1.20 (down a penny) Lake Tahoe, $1.26 (down 4 cents) Monterey, $1.30 (unchanged) Oakland, $1.28 (down 3 cents) Redding, $1.25 (down 7 cents) Sacramento, $1.27 (up a penny) San Francisco, $1.38 (down 1 cent) San Jose, $1.31 (down 2 cents) San Mateo, $1.31 (down 4 cents) San Rafael, $1.32 (down a penny) Santa Cruz, $1.32 (down a penny) Santa Rosa, $1.21 (down 6 cents) Stockton, $1.18 (down 4 cents)

    Since May 12, Nevada gas prices are down by an average of 3 cents a gallon to $1.21. In Utah, prices are up a penny to $1.16 a gallon in the same period, according to AAA's survey.
    Established more than 90 years ago, the AAA affiliate of Northern California, Nevada and Utah offers a wide array of automotive, insurance, travel and financial services. It is the second largest regional affiliate of the national AAA organization.

    Note to Editors: A chart showing 12 months of city averages is available on request.