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Gas prices low for last big weekend of summer

Gas prices low for last big weekend of summer

Lowest Labor Day prices at pump in three years
Gas prices low for last big weekend of summer
Adrian Latorre of Burnt Hills fills the tank of his 2013 Infiniti at Stewart’s Sunoco in Clifton Park Friday.
Photographer: Peter R. Barber

CAPITAL REGION -- There's good news for gasoline buyers this Labor Day weekend, the last big travel time of summer.

On Friday, prices as low as $2.39 per gallon could be found at two neighboring sites in Glenville, according to price comparison website gasbuddy.com, though $2.67 was the Capital Region average price. Prices have dropped for five consecutive weeks, according to the website, and are at their lowest for Labor Day in three years.

While it's more typical for prices at the pump to spike upward right before the big demand of a big travel weekend, there are larger seasonal, national and global forces working to the benefit of those of us who hold the pump handle.

"While it's typical to see prices falling after Labor Day, this year we're getting a head start on the decline that usually happens going into fall," said Eric Stigberg, a spokesman for AAA Northway in Schenectady. "In September the refineries switch to the winter blends, which are cheaper to produce."

There's a large inventory of gasoline in storage, Stigberg said, and concerns about the U.S. trade war with China are also having an impact on futures prices.

AAA no longer makes a specific Labor Day travel numbers forecast, but tens of millions of people are expected to be on the roads in the Northeast, Stigberg said.

"We've seen record travel all summer long, and we expect that to continue through Labor Day," he said. "As far as people coming into AAA looking for information and help planning a trip, we are seeing record levels of activity."

A big reason, Stigberg said, is "the economy is in a great place, and that leads to more travel. Unemployment is low and people have the income to travel."

The average retail price for gasoline in upstate New York was $2.72 last week, according to the New York State Energy Research and Development Authority, down nearly 20 cents from a year ago, and the lowest it has been since early April.

But the downward price trend could easily be upset by events, Stigberg noted. Hurricane Dorian is expected to his Florida early next week as a potentially destructive Category 4 storm. "That has the potential to impact the Gulf Coast, and that has the potential to impact oil production, and that could change the AAA forecast really fast," he said.

GasBuddy, which is primarily a smartphone app for finding low gas prices, is taking a special focus on the evolving situation in Florida, where worried motorists have been making runs on gas stations ahead of Dorian's landfall.

But GasBuddy is also expecting a continued downward trend over the next few months. "Gas prices are likely to face additional headwinds into the autumn as the transition back to cheaper winter gasoline begins in just two weeks, while demand for gasoline is also expected to begin a seasonal downturn," GasBuddy said in a forecast.

Some parts of the United States, mostly in oil-producing areas, could see prices drop below $2 per gallon by Thanksgiving, GasBuddy predicts.

The U.S. Energy Information Administration expects that monthly average gas price nationally peaked for the year in May, at an average of $2.86 per gallon, and will fall to an average of $2.64 in September.

"Relatively high gasoline production and slightly lower consumption have likely contributed to high inventory levels and put downward pressure on U.S. gasoline prices going into the Labor Day weekend," the EIA said in a forecast released Friday. "As of August 26, U.S. gasoline prices are 14 cents/gal lower than the average of the week before Labor Day for the past five years."

Energy analysts said the trade war is raising fears of recession, which would dampen demand and cause prices to drop. The trade war is also raising concerns about the oil industry's importation of cheaper Chinese steel, and that China will reduce its U.S. oil imports, which would weaken the market for U.S. oil.

"The bottom line is that this ongoing trade war is inflicting real pain on the U.S. oil industry, and there is no end in sight. That is going to create headwinds in the oil markets for the foreseeable future," energy analyst Roger Rapier wrote this week in Forbes.

Returning to Labor Day, New York motorists can expect to see fewer highway construction workers and more police during their travels.

Gov. Andrew M. Cuomo on Thursday announced that temporary lane closures for road and bridge construction projects would be suspended beginning Friday and continuing through 6 a.m. Tuesday to accommodate travelers.

Cuomo also noted that state and local law enforcement will be participating in the statewide "Drive Sober or Get Pulled Over" enforcement through Monday, aimed at identifying and arresting people driving under the influence of alcohol or drugs.

Reach Gazette reporter Stephen Williams at 518-395-3086, [email protected] or @gazettesteve on Twitter.

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