The average price of regular, unleaded and diesel gas nationwide jumped 8.7 percent in May from April to a historic high of $3.07 a gallon. But this high may signal a gasoline price crash in coming months, according to a new study by the Lundberg Survey.
Nationwide, the cost of a gallon of gas has been on an upswing, with gas prices 88 cents higher than they stood in January. The price of unleaded gas, which commuters use most, stands two cents shy of the record high, at an average price of $3.04 nationally. The price of unleaded gas has already surpassed the national record high of $3.06 in Washington, D.C., with AAA reporting an average cost of a gallon of unleaded gas selling for $3.07 in the District.
But these high prices have the potential to bring a glut of foreign oil imports, which will eventually bring down the cost of gas, the report goes on to argue.
This may mean a plateau in prices in the coming months, said AAA spokesman John Townsend, who represents the mid-Atlantic region.
“Once the summer driving season begins, we’ll see the prices go down,” Townsend said. But, “I don’t think we’ll see them go down to record lows.”
The record high prices are due to a combination of factors including policy and machinery. Aging oil refineries in the United States are operating at 90 percent capacity, which means there is little additional capacity. OPEC has cut production by roughly 1.7 million barrels a day compared with last year while President Bush’s efforts to build up the strategic oil reserves takes an additional 100,000 barrels a day out of drivers’ gas tanks, Townsend said.
