Answered prayer: lower gas prices looming ahead

If road travelers pray for anything outside of an accident-free trip, it would certainly be lower gas prices. Guess what? Their prayer may be answered.
 

Prices have already fallen and forecasters predict further price declines as the summer progresses. At worst, perhaps, prices will not continue their rapid escalation.
 

"It is possible we have reached our peak," said Neil Gamson, an analyst for the federal International Energy Administration (IEA), which was formed by the US and 27 other countries after the energy crisis of the 1970s.
 

Troy Green, a spokesperson for AAA, says retail gas prices should be coming down, though no one publicly has been predicting to what degree.
 

“Wholesale gasoline right now is trading significantly less than it was earlier this spring, and that bodes well for the summer driving season,” he said.
 

That’s particularly good news for travelers because there were predictions that gas could reach $5 or even $6 a gallon this summer.
 

Reasons for the slowdown in prices include actions by the US and the International Energy Administration. The later announced plans to sell 60 million barrels of oil from emergency reserves. The hint was that more might be released alter.
 

The release includes 30 million barrels from the US Strategic Petroleum Reserve. That move is aimed at cutting crude prices and bolstering the sputtering global economy by offsetting production declines in Libya and the Middle East, analysts say.
 

Sen. Sherrod Brown, the Ohio Democrat who has pushed for oil reserve sales since rising gas prices began threatening to derail the economy, applauded the decision. "It's something we've been asking for for six months,'' he said. "It's smart and will help the economy."
 

Republicans criticized the move.
 

"The president is using a national security instrument to address his domestic political problems,'' said House Speaker John Boehner, R-Ohio.
 

The US is releasing just 4 percent of the petroleum reserve, not enough to dent emergency supplies, according to industry analysts.
 

Many in the travel industry have been worried for months about how the high prices would affect consumers. They especially remembered how record fuel prices in 2008 ruined travel plans.
 

There are gathering signs, though, that summer travel will be at least as good or even slightly better than last year even with higher prices and air fares.
 

Travel industry officials said consumers were already showing signs they wanted to travel as much if not more than a year ago. But that was in part because they planned to offset their fuel costs by eating cheaper meals and finding less costly hotel rooms.
 

Now, travel industry officials said, the dropping gasoline prices will at least provide a psychological boost.
 

"This packs a psychological punch that's going to lower pump prices, for sure,'' said industry analyst Jim Ritterbusch. "This is a lift for both consumers and the economy."
 

Forecasters also add the caveat that nothing is certain in the volatile gas pricing market. A revolution or some other unexpected event at oil-producing countries could mean a return to rising prices.
 

Besides impacting car travel, rising gas prices obviously impact all facets of the travel market.

Second to autos is the impact on airlines who say they have to charge more for tickets. Jet fuel prices have risen more than 50 percent in the past year.
 

What’s the best prediction on where prices will go this summer? Most likely answer: somewhere between US$3.25 to $3.75 a gallon.
 

That does not sound so bad when it is compared to Europe where gas prices are at record levels. In Italy, a gallon of gas now costs over $8 a gallon.
 

By David Wilkening