Fall likely will hold few surprises for drivers when they fill the tanks of their mini-vans, sedans and trucks. Retail gasoline prices have fallen steadily this week and are expected to continue down, barring a hurricane that disrupts Gulf of Mexico production or a significant shift in the economy.
The national average for unleaded regular gasoline was $2.71 a gallon on Friday, which is about 3 cents lower than a week ago, based on a survey by AAA, Wright Express and the Oil Price Information Service. It's about 17.6 cents higher than a year ago.
Motorists in Texas, parts of the South and the Midwest paid the cheapest prices, averaging $2.50 a gallon to $2.585 a gallon. The highest prices, ranging from $2.84 a gallon to $3.502 a gallon were in the West and Illinois.
Supplies remain plentiful, demand has fallen since the summer driving season and gasoline is cheaper to make after Sept. 15 when refineries switch from summer blends intended to reduce smog to winter formulas.
"Without a hurricane actually targeting U.S. refining .October through December are pretty weak months for gasoline. I think we're in that slow drift now and my hunch is that we'll continue to see that slow drift," said Tom Kloza, publisher and chief oil analyst at Oil Price Information Service.
He estimated gasoline prices will fall to around $2.25 a gallon in the cheaper markets and hover around $2.75 a gallon in more expensive locations.
Cameron Hanover analyst Peter Beutel said motorists may see prices move 30 cents in either direction, contingent on storm activity or a major change in economic conditions. "Any spike higher is almost certainly going to be answered immediately by a spike back down" because of the supplies, he said.
Overall gasoline production is about 9 million barrels a day right now in the U.S., Kloza said. That includes about 1 million barrels that are imported daily.
Of the total, about 2.3 million barrels a day are produced in the Gulf. Many refineries schedule maintenance this time of year. When they operate at fuller capacity, the total is around 2.6 million barrels a day, Kloza said.
Meanwhile, hurricane activity appeared to intensify on Friday. A hurricane warning was in effect for the coasts of Nicaragua and Honduras as Tropical Storm Matthew approached Central America.
If a hurricane disrupts Gulf oil and gas production, at least some of it could be replaced by refineries elsewhere, Kloza said. For example, more foreign refiners can produce gasoline for U.S. markets in the fall and winter.
"After Sept. 15, the odds are that if you get hurricanes, you might have that emotional impact in the market, but they are much more demand destroyers than supply destroyers," he said.
In other trading, crude prices rose along with stocks on news that indicated an improving economy. The Commerce Department said orders for durable goods excluding the transportation sector rose 2 percent - the best showing in five months as companies invested in computers, communications equipment and machinery.
A separate report from the Commerce Department showed sales of new homes in August rebounded slightly.
Benchmark oil for November delivery rose $1.31 to settle at $76.49 a barrel on the New York Mercantile Exchange.
In other Nymex trading, heating oil rose 1.61 cents to settle at $2.1306 a gallon, gasoline added 2.97 cents to settle at $1.9471 a gallon and natural gas lost 13.8 cents to settle at $3.881 per 1,000 cubic feet.
In London, Brent crude rose 76 cents to settle at $78.87 a barrel on the ICE Futures exchange.
Associated Press writers Pablo Gorondi in Hungary and Alex Kennedy in Singapore contributed to this report.