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Gas Prices Lowest Since 1994

February 26, 1998

WASHINGTON (AP) _ With spring in the wings and vacation season on the way, there’s good news for many Americans: cheaper gasoline.

No, the nation isn’t heading back to the two-bits-a-gallon days.

But in some parts of the country, prices have fallen under $1 a gallon in recent months, the lowest since 1994.

Ten gallons for less than ten bucks?

``I knew they were going down, but this is the first day I noticed the price was less than the gallons I bought,″ said Toni Walling of Des Moines as she purchased gasoline at 99.9 cents-a-gallon.

``It gives people a little break,″ added Matt McKinney of nearby Waukee, Iowa. ``It saves a little money.″

But Ronald Mudge of Bondurant, Iowa, wasn’t satisfied. ``It’s not low enough,″ he said. ``There’s a lot of gas out there and someone in the middle is making a whole lot.″

John Strack of Little Rock, Ark., said he was paying about $1.30 in Jacksonville, Fla., before he moved recently. He was filling his sport utility vehicle at $1.01 and said ``I noticed it drop four or five cents over the last month.″

Gas isn’t that cheap everywhere, but an American Automobile Association survey found the average price for a gallon of self-service unleaded is $1.11 this month, 17.3 cents less than a year ago. That’s the lowest national average since May 1994 when it was $1.10.

In Kansas City, Mo., where he was filling up at 94.9 cents-a-gallon, ice cream truck driver George Novick said, ``You never know why the prices are going up or down.″

But some people have an idea.

Thank the Asian financial crisis, El Nino and improved technology, said Mike Shanahan, a spokesman for the American Petroleum Institute.

Asia’s financial problems have reduced the amount of oil being bought in that region, causing a drop in oil prices. In addition, the El Nino weather pattern so widely blamed for storms in California brought a mild winter to the normally colder parts of the country, reducing the need for heating oil. And, finally, oil companies have been able to find more oil because of better prospecting techniques.

That means there is a lot of oil available.

And the apparent settlement with Iraq may bode well for the future.

``We’re going to get more Iraqi oil hitting the oil terminals and the terminals are full so prices could come down more,″ said economist Donald Ratajczak of Georgia State University.

The Petroleum Institute’s Shanahan notes that local prices depend on a variety of other conditions such as taxes, the need for special air cleaning additives in some areas and the competition _ or lack of it _ between gas stations.

Gasoline is most expensive in the West at $1.24 for self serve unleaded regular and cheapest in the Southeast at $1.04. The AAA survey found self serve unleaded averaging $1.16 in New England, $1.11 in the Mid-Atlantic states, $1.06 in the Great Lakes area, $1.05 in the Midwest and $1.10 in the Southwest.

But within the regions there are scattered areas where gas can be had for under $1. These include parts of the Washington suburbs, and, according to a report in Oil & Gas Journal, Atlanta; Des Moines; Detroit; Kansas City, Mo.; Oklahoma City; St. Louis; Tulsa, Okla.; Wichita, Kan.; Houston; Little Rock and Cheyenne, Wyo.

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