The dramatic rise in gasoline prices cracked on Thursday, March 5. Just as oil-industry watchers predicted, there was no true explanation for the daily price increase that occurred in San Diego County during the past month.
On the evening of March 5, the Shell station on the corner of Encinitas Boulevard and El Camino Real dropped its price, for the first time since January 30, by four cents a gallon. On Friday afternoon, March 6, five stations in the South Oceanside area on Coast Highway — Bob’s Gas, 7-Eleven, 76/Circle K, Moshen, and Liberty Oil — all dropped their prices by around ten cents a gallon.
Over the weekend, most other stations in the area showed similar prices decreases, with the average price in the county dropping below $3.50/gallon, according to gasbuddy.com.
Experts say the price increases had to stop sometime. The market price of a barrel of oil did not spike upward as many speculators thought it would after a January 30 gain of 8 percent, as first reported here. Wholesale oil prices remained constant during the spike — around $50 per barrel.
With 20 oil refineries in California, industry watchers did not believe the explanation that the taking of oil-rich territory in Iraq by ISIS was the cause. With America now only importing 40 percent of its oil, less than 2 percent of our oil comes from Iraq. Nor did they believe the February 19 explosion and temporary closure of an Exxon-Mobil refinery in Torrance was the cause of the price spikes.
According to a February 12 report by AAA, gas prices were predicted to remain steady or fall slightly, with another slight increase expected in April and May with the switching to more expensive summer blends. According to gasbuddy.com, only 16 states will see gas increases in the next few days; the rest are either stagnant prices or, like California, falling. One thing is for certain: prices will not fall as dramatically as they went up.
As of March 7, eight San Diego County stations were competing for the lowest priced gas at $3.17/gallon. Six of the eight were in El Cajon or Escondido. Eleven stations, however, are hovering at or above $4.00/gallon, mostly in high tourist-visited areas of Carlsbad (two at the Legoland exit), Coronado, Del Mar, La Jolla, and Mission Valley. The highest is the 76 station at Garnet and Mission Bay Drive in Pacific Beach, at $4.19/gallon.
Update 3/9, 4:30 p.m.
On March 9, Goldman Sachs commodities analyst Damien Courvalin predicted a glut in global oil production might send prices down to $40/barrel.