By Mark Huffman
ConsumerAffairs.com
June 26, 2009
After rising for 54 consecutive days, the price of gasoline has declined for five days in a row, with the nationwide average for self-serve regular hitting $2.658 today, according to AAA's Fuel Gauge Report. That's nearly four cents lower than last Friday's average of $2.69.
The price peaked Sunday at just under $2.70 a gallon.
Despite the downward trend, two more states have joined California this week with average prices over the $3 a gallon mark. Hawaii has the most expensive gas in the nation, with an average price of $3.09 a gallon. Alaska's average price is $3.012 a gallon. California is now third, at $3.010.
In California, the most expensive gasoline is found in San Francisco, where the average price is $3.086 a gallon. The least expensive gas in found in the Chico-Paradise metro, where the average is $2.909.
Nationwide, the cheapest gas today is found in Missouri, with an average price of $2.46 a gallon.
Andrew Delmege, AAA's manager of regulatory affairs, says the price reversal is a sign the market is returning to reality.
Prices have largely been rallying on investor hopes of a robust economic recovery, he said. The markets reality check came in the form of a World Bank forecast of global economic growth that predicted the global economy would contract at a rate of 2.9 perccent for 2009 — the worst such contraction on record. The forecast reminded investors of the depth of the global recession and traders of the fact that market fundamentals belie the recent run up in oil and gasoline prices.
Delmege said where oil and retail gasoline prices head from here is largely dependent on the economy and investor perception of the pace of economic activity. If investors feel the economy will soon turn around, he says the price of oil and gasoline will rebound. However, if the economic activity is muted, it believes it would be difficult for the markets to justify a runaway rally in prices in 2009.
