Fall gas prices to drop in NJ? That depends on gas tax
There's good and bad news on gas prices for the coming fall. Prices will drop in New Jersey, but the state government may raise the gas tax again.
Tom Kloza, global head of energy analysis at the Oil Price Information Service, says New Jersey is averaging $2.66-a-gallon, about 15 to 18 cents lower than last year at this time.
"We're on a trajectory that will keep it that way into autumn when prices normally do drift lower," he said.
"So much additional crude is coming on from west Texas and now they have the pipelines to move it. And there's also the threat that at any moment, the entire global macroeconomic view could tilt this toward recession. So we really are seeing flat prices."
Kloza says with the hurricane season still a threat to Gulf of Mexico refineries, "we still have the ability to see storms tighten global gasoline supply and particularly U.S. gasoline supply for about three more weeks."
But he quickly added, "I don't want to dismiss hurricanes that happen from the second half of September on. But once you get to where the fuel specifications change, there's just not that much ability for hurricanes to really have a great great impact on gas prices."
He refers to New Jersey refineries switching away from what's known as the "summer formula" of gasoline to a mix that is cheaper to produce and thus cheaper at the retail level.
The other fly in the ointment for lower prices: the AAA auto club warns that New Jersey treasury officials may decide by month's end to hike the current state gasoline tax, which is currently 41.4 cents per gallon, to keep the Transportation Trust Fund solvent. The fund is used to fund New Jersey road and bridge projects. There is no word about where the tax is going, but AAA warns "the Labor Day weekend could prove to be a disappointing end of summer for New Jerseyans."
Joe Cutter is the Senior News Anchor on New Jersey 101.5