While gas prices may still be too "high" in most people's opinion, AAA Mid-Atlantic says Maryland gas prices are falling and prepare for a sharper descent.
AAA Mid-Atlantic monitors weekly, monthly and annual gas prices across the state and association officials contend a dip in gas prices is notable and the slide could continue throughout the summer months.
In Maryland the price of regular grade gasoline dropped 4 cents compared to last week, 21 cents compared to last month and 17 cents from a year ago.
This downturn in gas prices might encourage some Maryland residents to buck the current vacation trend-a staycation, and head toward Ocean City or another Delmarva vacation destination.
Ragina Averella, AAA Mid-Atlantic's Manager of Public and Government Affairs, said as summer approaches, many travelers are holding their breath, eagerly awaiting a drop in gas prices.
"Motorists, especially summer travelers, are wondering if recent relief at the gas pumps will continue throughout the season...The answer is most likely," Averella said. "Barring any unforeseen national or global economic disaster some analysts have revised gas price forecasts for the summer driving season, with prices potentially dropping to $3.00 or below in some regions of the country."
Why so low?
AAA Mid-Atlantic says the downturn in gasoline prices is due to the steady decline of crude oil prices. At $81 to $85 per barrel, crude oil prices have dropped more than 20 percent from spring-a peak period.
According to the AAA Mid-Atlantic, crude oil prices fluctuated by week's end, ahead of several events that could have influenced global supply and demand:
- The Organization of Petroleum Exporting Countries (OPEC) formally announced it was keeping its output ceiling of 30 million barrels a day in place.
- Sunday's Greek election and the possibility of the country abandoning the euro, indicating the European financial crisis could worsen, making ample availability of crude oil in the market.
The Automobile Association also pointed to weekly reports of gasoline stocks and demand.
The Energy Information Administration (EIA) reported the nation’s crude oil stocks fell 191,000 barrels to 384.4 million barrels, still a comfortable U.S. inventory. Gasoline stocks fell 1.7 million barrels to 201.8 million barrels. Gasoline demand was a surprise, rising by 482,000 barrels per day (bpd) to 9.13-million bpd, the highest implied gasoline demand number since last August.
The all-time record high for gasoline prices was set in July 2008-$4.11 a gallon.