From staff and wire reports
Gasoline prices in the Kansas City area are down about 10 cents a gallon heading into this weekend from a week ago.
From staff and wire reports
In time for peak driving seasonAccording to the latest AAA survey, prices on the Kansas side were down about 9 cents to $3.51 a gallon from a week ago. On the Missouri side, prices averaged $3.43 a gallon, down 10 cents from last weekend.
Prices have been dropping over the past month, though the cost of a gallon is still up about 80 cents compared to late June 2010, according to AAA data.
More relief could be coming in the wake of decisions by the United States and other nations to sell 60 million barrels of crude from emergency stocks in an effort to ease the strain of high oil prices on the global economy.
The release by the International Energy Agency, a group of more than two dozen countries, covers only what the world uses roughly every 16 hours. But it was enough to send oil prices lower, at least for the moment.
In addition to helping the struggling economies of the U.S. and Europe, analysts said the move was meant as a rebuke to OPEC, which has refused to increase oil production to bring down prices.
It will be the largest sale of crude ever from world strategic reserves and only the third since the IEA was formed in 1974 after the Arab oil embargo. The IEA released oil in 2005 after Hurricane Katrina and in 1990 and 1991 after Iraq invaded Kuwait.
Half the oil will come from reserves in the U.S. Refiners who turn crude into gasoline will be able to bid on the extra oil and have it shipped to them from the salt caverns along the Gulf Coast where it is stored.
The IEA said high oil demand and shortfalls of oil production caused by unrest in the Middle East and North Africa threatened to “undermine the fragile global economic recovery.”
The uprising in Libya has taken 1.5 million barrels of oil per day off of the market — half a million barrels less than will be released each day by the IEA.
The price of oil rose to nearly $114 per barrel in at the end of April, the highest since the summer of 2008, but since then has fallen considerably. Analysts questioned how much relief the move would provide the economy, and for how long.
One analyst, Andrew Lipow, said the timing of the announcement, a day after Federal Reserve Chairman Ben Bernanke delivered a negative outlook on the economy, suggests that industrialized countries are grasping for solutions. He said Americans should expect the price of gasoline to fall, but not dramatically, in coming weeks.
“Fifteen or 20 cents a gallon of relief is not enough to make people feel good about their job prospects or losses on the stock market or our general economic slowdown,” he said.
The IEA and the White House said they were acting to increase the supply of oil available during the peak summer driving season.
“We are taking this action in response to the ongoing loss of crude oil due to supply disruptions in Libya and other countries and their impact on the global economic recovery,” Energy Secretary Steven Chu said.
Gas prices have already fallen for 20 days in a row. They were down another penny Wednesday, to a nationwide average of $3.61 per gallon, according to the AAA Daily Fuel Gauge Report. That’s about 21 cents lower than a month ago.