Gasoline prices have fallen to a five-month low in advance of the busy July 4 travel week, but pump prices on Independence Day will still be the third highest recorded on the holiday, AAA said Tuesday.
Though gasoline prices remain high – at a national average of $3.48 for a gallon of regular on Tuesday – they have fallen for 20 straight days because refineries are producing fuel at high levels, AAA said. The average price for a gallon of gasoline in Houston is $3.32, according to AAA.
Refiners have built up the largest supply in decades at the end of June, said Andrew Lipow, president of Houston-based consulting firm Lipow Oil Associates.
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Gasoline stockpiles are up 10 percent from a year ago and the nation’s more than 225 million barrels of gasoline inventory is the highest level since 1992, according to the U.S. Energy Information Administration.
“Gasoline prices are probably going to fall another 2 to 3 cents a gallon (this week)
and then maybe another total of 5 to 7 cents over the next couple of weeks, but the outlook is for pretty stable gasoline supplies given that inventories” are high, Lipow said.
Though analysts expect average national gasoline prices to continue a modest decline, high world oil prices will likely keep prices from falling precipitously, AAA said.
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“Gas prices remain high and may not drop too much further in July because crude oil remains relatively expensive,” AAA spokesman Avery Ash said in a statement. “Factors such as increased summertime demand and the impending hurricane season also could result in higher pump prices for motorists.”
AAA estimates that 34.4 million Americans will hit the roads to travel more than 50 miles from home in automobiles during the holiday period beginning July 3 and ending July 7. That’s down slightly from a year ago, when an estimated 34.7 million Americans traveled by automobile for July 4, AAA said.
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