Vyto Starinskas / Staff Photo
Gas prices are dropping around the state, including here on North Main Street in Rutland on Monday.
With the summer driving season under way, Vermonters are reaping an unexpected surprise: lower gas prices.
According to VermontGasPrices.com, the average price of gasoline in the state Sunday was $3.66 a gallon — nearly 15 cents a gallon cheaper than a year ago and more than 17 cents cheaper than just a month ago.
In the last week, the price of gas has dropped 3.2 cents a gallon, VermontGasPrices.com reported Monday.
The national average is $3.53 a gallon — a drop of 12.6 cents a gallon from a year ago.
The monthly Vermont Fuel Price Report also reported a significant drop, with the price plummeting 19 cents a gallon since last month to an average of $3.75 a gallon. The June price is 10 cents cheaper than a year ago.
The Department of Public Service surveys 17 gas stations around the state on the first Monday of the month.
“It’s the basic driver, supply and demand,” said Michael Kundrath, energy policy and program analyst with the Department of Public Service. “And you’ve got economic slowdown in Japan, Europe, United States. You know the demand just isn’t there.”
There is also some increased supply in the United States, helping to keep prices down, Kundrath said.
On Monday, VermontGasPrices.com reported the lowest gas price in the state was $3.31 a gallon (cash only price) at the Jay Country Store in Jay; the highest price was $3.81 a gallon at the Citgo station near Browns Trace Road in Jericho.
Of the 20 locations listed with the lowest gas prices, seven were in the Rutland area. The Citgo station on North Main Street had the lowest local price for regular gas at $3.49 a gallon.
Over the last few years, gasoline prices have trended lower in June, said Patrick DeHaan, senior petroleum analyst with GasBuddy.com, which operates VermontGasPrices.com and more than 200 similar websites around the United States and Canada.
However, DeHaan said June gas prices are somewhat lower than what was anticipated.
He said the world oil market is reacting to anemic economic news, putting “downward pressure on crude oil prices.”
“The concern is that the downturn in Europe, because of the debt issues, may spread to other economies like the United States and that also would then have a negative impact on gasoline and petroleum demand,” DeHaan said.
Critics have blamed investment banks and hedge funds for driving up the price of oil and refined products.
DeHaan said “speculation is a two-way street.”
“It can cause prices to go up; it can cause prices to go down.” DeHaan said, “and speculators can run off with loads of money and they can lose loads of money.”
He added that the determining factor in setting commodity prices remains supply and demand.
Tourism is a major industry in the state with summer tourism attracting 5.1 million visitors who spend $471.6 million from June through August, according to the state Department of Tourism and Marketing.
With 80 million people living within a day’s drive of the state, tourism officials say that lower gas prices can only help tourism-dependent businesses.
Jen Butson, a spokeswoman for the Department of Tourism and Marketing, said in an email that requests for vacation packets are up 15 percent through May over last year. Butson also said traffic at the state’s information centers is up as well.
Although the national price of a gallon of gas has plummeted over the last month, the average price in Vermont remains more than 10 cents higher than the national average.
DeHaan said the higher prices reflect Vermont’s distance from refineries and pipelines, which means fuel stocks have to be trucked longer distances.
The federal Energy Information Administration has revised its national price forecast for the summer from $3.79 a gallon to $3.60 a gallon.
The EIA is forecasting U.S. crude oil production to average 6.3 million barrels of oil a day this year, an increase of 600,000 barrels from last year. It represents the highest production level since 1997.
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