Gas Gets Cheaper as Oil Glut Persists, says AAA Survey

16 December 1998

Gas Gets Cheaper as Oil Glut Persists, says AAA Survey; Lowest Pre-Holiday Pump Prices Since 1991

    SAN FRANCISCO--Dec. 15, 1998--Santa can fill up for less when passing through Northern California, where gas prices are 23 cents less than one year ago, AAA reported today.
    The Northern California average is $1.16 for a self-serve gallon of regular unleaded, down a penny from last month, according to AAA's monthly gas survey.
    "Gas prices haven't been this low in any December in seven years, when the average price was $1.15," said AAA spokesman Paul Moreno. "Northern California gas is now cheaper than any time since March 1994, when the average also was $1.15."
    Gas prices have steadily declined much of the year due to falling crude oil prices.
    "Crude prices are nearly half of what they were 14 months ago," Moreno said. "Prices have been steadily drifting downward like snowflakes, and consumers will get an extra present by paying less for gas."
    The glut of oil has been swelled by stagnant demand due to economic slowdown in parts of the world and global high production throughout the year.
    Adding to the oversupply is less driving in winter and the recent mild weather, which has kept demand low for heating oil, analysts say.
    "It's still early winter, but so far it's been relatively warm," said Alan Kovski of The Oil Daily, a Washington, D.C.-based newsletter. "And the heating oil markets are already glutted."
    OPEC members and other oil-producing nations have been meeting repeatedly in unsuccessful efforts to reduce the surplus and thereby boost prices. Last week, oil prices hit a 12-year low.
    In Northern California, local averages for regular unleaded self-serve gasoline (since November 17) are:

- Chico, $1.08 (down 4 cents)      - Concord, $1.11 (down a penny)
- Eureka, $1.23 (down 2 cents)     - Fresno, $1.10 (up 2 cents)
- Lake Tahoe, $1.20 (up a penny)   - Modesto, $1.03 (down a penny)
- Monterey, $1.23 (up a penny)     - Oakland, $1.21 (up a penny)
- Redding, $1.13 (down 4 cents)    - Sacramento, $1.08 (unchanged)
- Salinas, $1.17 (down a penny)    - San Francisco, $1.29 (up 2 cents)
- San Jose, $1.15 (up a penny)     - San Mateo, $1.23 (unchanged)
- San Rafael, $1.19 (down a penny) - Santa Cruz, $1.19 (unchanged)
- Santa Rosa, $1.13 (unchanged)    - Stockton, $1.07 (unchanged)
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    Since last month, Nevada gas prices are down 3 cents to $1.14 a gallon. In Utah, prices are down 8 cents to $1.04 a gallon in the same period, according to AAA's survey of more than 400 gas stations in Northern California, Nevada and Utah.
    Established more than 90 years ago, the AAA affiliate of Northern California, Nevada and Utah offers a wide array of automotive, insurance, travel and financial services. It is the second largest regional affiliate of the national AAA organization.

    Note to Editors: A chart showing 12 months of city averages is available. Additional city averages, including Southern California cities, are available on request. AAA's December holiday travel projections will be available Dec. 21.