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Gasoline Prices Keep Falling

March 8, 1998

LOS ANGELES (AP) _ Remember the good old days? When it comes to paying for gasoline, this is one of them.

The average all-grade pump price has dropped nearly 3 cents since Feb. 20, an industry analyst said Sunday. When the figures are adjusted for inflation, it means customers are getting the lowest price ever, said Trilby Lundberg.

The Lundberg Survey checks 10,000 gas stations nationwide.

The national average for self- and full-service combined was $1.0924 as of March 6. Since September, the average has fallen more than 23 cents.

Regular self-serve gasoline was selling for less than $1 at nearly half the stations in the country.

``The decline since September qualifies as a price crash, and the pump price on average is now lower than it’s ever been since the beginning of the gasoline market, taking inflation into account,″ Lundberg said.

The main reasons are a continuing sag in crude oil prices and an old-fashioned price war among refiners and distributors, Lundberg said.

``It appeared a few weeks ago that prices were bottoming out because they rose in more than a dozen cities,″ she said. But crude continued its slump from the $24-per-barrel range late last year to below $15.

``This additional fall in the price of crude oil has smashed my earlier view that price cutting was ending,″ Lundberg said.

Retail profit margins are ``distressed,″ she said.

``Since a spring demand is not quite under way yet, it will be up to crude oil to determine whether retailers can cut further or must cry ‘uncle’ and raise prices,″ Lundberg said.

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