U.S. lowers estimate for price of gas this summer
5/9/2012NEW YORK -- Gasoline prices are not likely to set any records this summer, thanks to a recent drop in the price of oil.
The government on Tuesday slashed its forecast for average gas prices to $3.79 a gallon for the summer driving season.
That is down from an initial estimate of $3.95 and below 2008's record average of $3.80.
The Energy Information Administration's revised forecast is encouraging news for the economy.
Some economists blame high pump prices for so-so consumer spending this year. The cost was believed to be a factor in the loss of 35,000 retail jobs in February and March.
Gasoline prices soared 20 percent from January to early April.
A few analysts warned drivers they could pay as much as $5 this summer, eclipsing the 2008 record of $4.11 per gallon.
But the price of benchmark crude oil has dropped about $8 a barrel since early April. Retail gas prices have followed, falling 17 cents since reaching $3.936 on April 5.
"It's almost like a tax cut," said Jared Bernstein, a senior fellow at the Center for Budget and Policy Priorities.
The Energy Information Agency's prediction means motorists will spend about $10.7 billion less on gasoline than anticipated.
Last year, drivers paid an average of $3.71 a gallon from April to September.
The national average for gas is now $3.76 a gallon, according to AAA, Wright Express, and Oil Price Information Service.
That's 20 cents cheaper than a year ago.
In Toledo Tuesday the average price was $3.743, down almost four cents from the day before, according to gasbuddy.com, which can be found at toledoblade.com/gas.