More On Gas Prices

05/21/96

The AAA announced last week that gas prices rose to a 15 year high in late April and early May, while an agency internal to the U.S. Department of Energy announced that gas prices have peaked.

The AAA reports that the national average price per gallon of self serve unleaded rose to $1.31, 7 cents higher than the price during their last survey and 18 cents higher than three months ago. The price is the highest pre-memorial day price recorded since 1981, when gas cost $1.38 per gallon. The highest prices recorded by the AAA survey were in the West, where a gallon of self serve unleaded cost about $1.45.

Meanwhile, the U.S. Energy Information Agency announced that gas prices appear to have peaked, and that consumers should soon see lower prices at pumps. The EIA says that the gasoline supply-demand balance is still tight, but that supplies continue to increase, as U.S. gasoline production is up about 500,000 barrels a day. High gas prices across the nation have been blamed on tight supply, and the EIA report says that growing supply will make prices more moderate.

Even though it looks like gas prices will fall, AAA spokesman Jerry Cheske has a word of warning for drivers looking for good gas deals soon: "The fly in the ointment," says Cheske, "is that from previous experience we all know that prices don't fall as quickly as they rise."

Paul Dever -- The Auto Channel