FORT SMITH — In an extended streak of falling gas prices nationwide, Arkansas is among 10 states with the lowest gas prices this week with an average of $3.175 per gallon for regular gasoline, according to AAA’s Fuel Gauge Report.
Prices for regular gas dipped below $3.00 in several locations in Central and western Arkansas this week, with low prices of $2.94 per gallon reported at two locations in Fort Smith on Wednesday, according to GasBuddy.com.
Over September, gas prices dropped nearly 40 cents, the fastest rate in 11 months, with a national average of $3.39 per gallon for regular gasoline. The national average has declined for 29 days in a row, the longest consecutive decline since April 2012 and the largest monthly decline since October 2012.
A simple equation of supply and demand can be attributed to the drop, as gasoline stocks are more than 10 percent higher than a year ago, AAA spokesman Avery Ash said.
No hurricanes have disrupted refineries, summer road trip season has come to an end, and less costly winter-blend gasoline is now in circulation. Winter-blend gasoline can cost 10 to 15 cents per gallon less than summer fuel because it is not required to meet stricter air regulations, according to the AAA website.
"Gas prices could drop another 25 to 30 cents per gallon to the cheapest averages of the year barring significant refinery problems or higher oil costs," Ash said. "Averages in as many as five to 10 states could drop below $3 per gallon, but there is a floor to how low the national average can go given the very high cost of crude oil."
Libya is also starting to release oil exports, said Aaron Littlefield, president of Fort Smith gas supplier Littlefield Companies.
"I think there was some price built in to the publicly traded market with Syria, and Libya is coming back with exports," Littlefield said. "Also, the Fed thought it was going to be able to cut back on qualitative easing, but the economy is not roaring back so we’re seeing some bearish energy. There are some political issues built in."
Despite cheaper gas prices, the price of West Texas Intermediate (WTI) crude oil has closed above $100 per barrel every day since July 3. This is the longest consecutive period that WTI has remained above $100 per barrel since the summer of 2008, when the national average price of gas reached an all-time high of $4.11 per gallon.
The price of WTI crude oil has declined from recent highs above $110 per barrel in late August to the most recent closing price of $102.80 per barrel, which is still about $11 per barrel more expensive than a year ago.
The cheapest gas prices are in the southeastern United States, where access to large local refineries and lower taxes has helped reduce the cost. California has the most expensive prices in the continental United States due to recent refinery problems and high fuel taxes.
The five states with the highest average prices this week are Hawaii ($4.26), Alaska ($3.93), California ($3.92), Connecticut ($3.79) and New York ($3.73).
The five states with the lowest average prices are South Carolina ($3.09), Missouri ($3.14), Mississippi ($3.15), Virginia ($3.17) and Texas ($3.17).
John Lovett writes for the Times Record in Fort Smith