Chautauqua area motorists will save 4.4 cents a gallon this week when they pull up to the pump. The average price for a gallon of self-serve, regular unleaded gasoline has dropped to $3.813.
According to AAA's Fuel Gauge, crude oil prices traded higher yesterday as a weaker U.S. dollar provided upward pressure on commodities and equities alike. Traded in U.S. dollars, as the dollar weakens relative to currencies abroad, the effective price of these products - including crude oil - becomes cheaper and a more attractive investment and prices are pressured upward. At the close of formal trading on the NYMEX, crude oil settled at $87.88 per barrel, up $2.50.
Following last Monday's dramatic decline of both, the major stock market indices and crude oil prices, markets opened last Tuesday with some cautious support as traders regrouped following the largest one-day decline (513 points) in the Dow since December 1, 2008, and the fifth-largest in history. This support focused on Tuesday's Federal Reserve (Fed) meeting, which was expected to center on the possibility of further economic stimulus in the form of quantitative easing. Directly following the announcement that the Fed would keep interest rates low through 2013 but not take steps toward a new round of quantitative easing, crude oil and equity markets plunged lower, with crude prices settling $2.01 per barrel lower at $79.30 per barrel. This marked the first time that crude oil had closed below $80 per barrel since Oct. 19, 2010.
Thursday was another reversal in market momentum as the rollercoaster week continued, with equities and commodities both rising sharply together following the Department of Labor reporting 400,000 jobless claims for the week prior - the lowest level since early-April and much lower than analysts' expectations.
While crude oil prices have exhibited dramatic shifts in momentum in recent trading, gasoline prices have continued to steadily decline. The current national retail average price for a gallon of self-serve regular gasoline is $3.587. Today's average price is 6.5 cents cheaper than one week ago and 8.9 cents cheaper than one month ago, but remains 83.7 cents higher than one year ago. As of today, Hawaii ($4.11) is the only state that remains above the $4 per gallon threshold.