By Michael O’Donnell
While the sudden drop in gas prices has put money back in the consumer’s pockets, it also has drivers sitting tight with their fingers crossed.
Junior James Bastin, a business major at Flagler College, remains optimistic that the gas prices will keep dropping.
“While I do think that prices will keep going down this quarter, a lot depends on if there is another natural disaster such as Hurricane Katrina, or things heat up with the Middle East,” Bastin said.
Not everyone is optimistic, however. Junior Paul Cacciatore, a religion and philosophy major feels otherwise.
“They are going to keep the gas prices as high as they can in order to maximize profits without alienating the general public,” he said. “As long as the American public continues to demand lower gas prices they will continue to go down. It is until the American public is satisfied that we will see stabilization in the prices. In essence I feel that gasoline companies are using this as a marketing tool.”
But as the summer demand from motorists slows and hurricane season reaches its peak, gasoline prices across the United States are in fact dropping.
The national average is about $2.44 per gallon according to the American Automobile Association, and it may even reach as low as $2.25 a gallon for the first time since February, according to the Energy Information Administration.
However, gas prices falling to $2 per gallon may be out of the question according to economist Sara Banaszak for API Energy.
“The reason gas prices may not hit $2 per gallon is because that would mean that the price of crude oil would have to drop dramatically again. Crude oil has dropped already from $77 a barrel to now $61 a barrel, which is already a huge drop and people just do not see crude oil dropping like that again,” Banaszak said.
The decrease in gas consumption could have been caused by early hurricane season projections, according to AAA. Forecasts for this year’s hurricane season were originally predicted to rival the record number of storms we had last year.
This prediction ultimately sent gasoline prices to $3.36 a gallon, making the nationwide average price for the price of gasoline by Sept. 1, about two cents below the record set after Hurricane Katrina.
“It also has a lot to do with the fact that taxes are stabilizing in the United States and ultimately the price for refining margin for crude oil has narrowed, making it cheaper to excavate and refine oil,” Banasak said.
Also, according to the Union of Concerned Scientists, increased awareness of global warming and the effects it has on the eco-system could have thrown the fossil fuel industry into a state of unease, causing industry gasoline prices to drop dramatically.
However, with the drop in gas prices, could this spark the end of the “green movement?” According to David Guest, managing attorney for Earth Justice, that is not likely.
“No, I don’t believe it will happen. The fuel price drop is a short term event. The Lebanon War provided a short burst of extra production,” Guest said. “However, my projection that within eight weeks or sometime shortly after, gas prices will be back to $3 per gallon. I also believe that realistically we will start seeing gas go up to $5 per gallon at some point, which is why 75,000 employees were laid off at Ford Motors in Detroit, and also explains why Ford and Chrysler are going bankrupt.”