Gas prices are dropping in NJ … and should keep getting lower
Gas prices are down slightly this week. But they may slip even more as fall kicks in.
GasBuddy.com shows Jersey's average pump price at $1.97 this week, down from $1.99 a week ago. Senior petroleum analyst Patrick DeHaan of GasBuddy says that's"not a huge decline, but a trend that we should see continue for quite a bit of time this fall."
DeHaan says reduced demand and a switch this Friday to a gas formula that costs less to manufacture, the so-called, "winter formula" that contains less butane, will cut prices. DeHaan says we spent much of late and mid-August seeing world prices rise tremendously, and gas prices had followed that trend upward.
"To begin the month of September, oil prices started to climb. And a lot of the reason for the climb was on comments and threats that OPEC was making that they were perhaps cutting oil production," he said. "And while the market rallied, and then went backwards, when they realized that perhaps these are merely threats and will not actually play out. Not only that, but Labor Day is over, driving season is over. All of those factors are now pushing gas prices back down."
DeHaan says the fallen gasoline demand is a seasonal drop, much as how see see demand go up in the summer. It falls after summer is over.
Long term, he says, the oil industry may get rid of the current oil glut. That, coupled with future OPEC production cuts, could raise gas prices next year, according to DeHaan.
Joe Cutter is the afternoon news anchor on New Jersey 101.5.
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