Soccer Dad

Like the first robin of spring

For the first time since news of Hurricane Katrina sent gas prices over a dollar (a gallon) higher I finally saw gas selling for less than $2 last night. It was at the Pilot station in Carney's Point NJ (just of Interstate 295 north of the Delaware Memorial bridge. It's accessible from the I-95 southbound.)

Granted it was 1/100 of a cent less than $2, but still an indication that oil prices are settling back down. This station regularly has prices that are at least 5 cents less than any other station. My suspicion is that we'll soon start other stations drop below $2. The only question is where the price will finally settle.

If any bloggers out there has sighted gas at less then $2 a gallon, let me know and I'll post a link. If you don't blog and see this, let me know and I'll post the location.

UPDATE: Meryl Yourish notices that gas prices are approaching $2 a gallon in her area (Richmond) but not in her neighborhood, yet. Elie's Expositions has found it at about $2.10 in central Jersey, but notes a Star Ledger story (brief registration necessary) pointing to lower prices elsewhere in the state:

In the farthest corner of southwest New Jersey, past the tractor cemetery that is the Schaper Bros. Farm and Garden Supply, and the Eatmor supermarket advertising collard greens, is gasoline nirvana.

The towering green and yellow sign of the Major Truck Plaza in Rosenhayn announces the elusive $1.98 a gallon.

"I said, 'Praise the Lord! It's about time,'" said Linda Parkell, a regular customer of the truck plaza.

The gallon of everyone's dreams resulted from a price war between Garden State Fuel and neighboring Major in Cumberland County. But even without the desperate competition, oil industry experts say this is the time of year gas-guzzling consumers can expect relief. Two dollars a gallon may be an anomaly, but prices will still be far from the $3 that was commonplace after Hurricanes Katrina and Rita pummeled refineries and oil pipelines along the Gulf Coast.

"November is typically the low point of the market," said Michele Mount, of AAA New Jersey.

When it comes to gas prices, there is a slow decline from Labor Day to Thanksgiving. The trend usually tapers off in December, Mount said. Prices often decline again in January before the spring rush.

So maybe it's not all that surprising. Of course if you're a member of Congress you might well be seething that it happened without your intervention. As members of Congress flaunted their concern for us consumers, Jeff Jacoby noted:

In fact, the real gas and oil profiteers weren't represented by the CEOs getting grilled on Capitol Hill last week, but by the demagogues doing the grilling. Over the past 25 years, according to the Tax Foundation, oil companies paid state and federal taxes of more than $2.2 trillion (in inflation-adjusted dollars). During the same period, the companies' profits totaled $630 billion -- less than a third of the government's take. Government revenue from gasoline taxes alone has exceeded oil industry profits in 22 of the past 25 years.

If Gregg and his colleagues want to see what America's greediest oil fatcats look like, they can find the answer in the nearest mirror. Will they do anything to rein in those money-grubbing villains? Don't hold your breath.

The market responding to the shortages due to Katrina lifted the prices. When the supply was restored, the prices dropped (and continue to do so.)

I e-mailed the Jacoby column to the Fire Ant Gazette who had an earlier entry on the subject. He summarized Jacoby's column nicely at A Bostonian's Perspective on Big Oil (and graciously credited me).

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