The U.S. Energy Information Administration reports that although the U.S. average price for regular gasoline continued to weaken, the average slipped less than half a cent, remaining essentially unchanged at $2.73 per gallon. The price was ten cents higher than last year at this time. The West Coast price rose three cents to $3.01 per gallon, while the average in California increased more than four cents to settle at $3.07 per gallon.
     The national average for diesel fuel fell for the fourth week in a row, dropping three cents to $2.95 per gallon, 45 cents above the price a year ago. The cumulative drop for the four weeks amounted to 18 cents per gallon. The average on the West Coast (Alaska, Arizona, California, Hawaii, Nevada, Oregon, and Washington) slid two cents to $3.06 per gallon and the California price fell less than three cents to $3.07 per gallon.
     California legislation calls for a motor vehicle fuel excise tax rate increase of 17.3 cents and a corresponding sales and use tax rate decrease from 8.25 percent to 2.25 percent on sales of motor vehicle fuel. This will go into effect July 1, 2010. At current prices, the change will have little noticeable impact on cardlock prices. On the same day, motor fuels delivered into Washoe County, Nevada will see a tax increase as directed by Assembly Bill 516. At current gasoline and diesel prices, the increase equals about three cents per gallon.
     Experts disagree on the future of domestic fuel consumption for the next few years. The Oil Price Information Service asserts that 9% of domestic refining capacity should be permanently closed in order to bring supply and demand into balance. By contrast, Macquarie Commodities Research suggests that the demise of U.S. gasoline is greatly exaggerated and that U.S. gasoline demand can be expected to grow again over the next five years.

Chris Nobles
Commercial Fueling
Nella Oil Company