For those of you nearby (I grew up outside of Lima):
http://www.limaohio.com/story.php?IDnum=10255LIMA — It seems gas stations have gotten into the spirit of holiday sales too.
Gas prices are noticeably lower, $1.49 for regular unleaded in Lima and $1.69 in Putnam County, compared to what motorists were seeing all summer long.
It bodes well for the holiday travel season, according to AAA Ohio spokeswoman Susan Stewart. AAA is estimating more travelers than last year because Christmas and New Year’s fall on Saturdays.
One of the reasons for the lower prices is the re-establishment of gas prices in relation to oil prices, said A.F. Alhajji, associate professor of economics at Ohio Northern University.
“The correlation between oil prices and gasoline prices are very strong,” Alhajji said. “In the summer, we saw a debuckle between the prices simply because we had so many problems in the summer that made gasoline prices go up while oil prices were not going up as much.”
Alhajji said consumers can expect gas prices to follow the trend of oil prices for the next few months unless there is a problem in the country, such as refinery outages.
“Refiners are using lower quality oil to get gasoline at this time. The premium between light crude and heavy crude is very large at this time. That premium outweighs the inefficiency of producing gasoline from heavy oil,” Alhajji said. “Heavy oil relative to light oil is very cheap and this may explain why some gas stations have gasoline for $1.49 and $1.50 at this time.”
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