East Texas (KTRE) - It's almost like a surprise stimulus check. These were gasoline prices just three weeks ago and now consumers are experiencing another round of falling prices this week. Retail gasoline prices in the Lufkin-Nacogdoches area are averaging about a-dollar-83 a gallon for regular unleaded. At a few stations the price is as low as a-dollar-79 cents a gallon. At those prices, gasoline is more than a dollar a gallon lower than the year-ago price.
Consumers are enjoying the lower prices, but the question we've all asked at one point.
"Say they are buying it for 100 dollars a barrel and it goes up to 120. Well, that's 30 days out. Why is it going to go up the next day?" asks consumer Brad Goodman.
Why does the price of gas go up so much faster than it comes down?
Oil prices are about 50-dollars a barrel now, down nearly 68-percent since the record high of 147-dollars back in July. At that time, the national average for a gallon of gas was four-dollars-11-cents, so why is it just now getting back below two-dollars a gallon?
"They're not working off $64 crude now. They're working off that crude that was back up there in the 80s and 90s," says Mark Lawson. Mark Lawson is the Executive Director of the Petroleum Marketers Association. He says falling gas prices could lag behind falling oil prices by as much as six weeks. "Loads went from 12 thousand a load to 32 to 34 thousand dollars a load. When prices are escalating that rapidly, they have to get that price at the pump in order to buy the next load."
Translation: Suppliers need the money to get fuel in the pumps. So, the supply is there and now that demand is falling, thanks to the economy, Larson says stations are trying to do what little they can to recoup their losses. "These retailers are making anywhere from 3 to 5 cents a gallon -- 1 percent of the total."
What's more, I-U-S Business Professor Eric Schansberg says we'd better enjoy the low prices while we can, he doesn't see them sticking around. "If the dollar weakens again to where it was. Prices will go right back up. That was the number one reason we had high gas prices to begin with."
On a related note, falling gas prices are being cited for a drop in consumer prices. The government reports that consumer prices fell by the biggest amount in 61 years last month, good news for consumers, bad for corporate profits.