Gas Prices Down, But People Still Cautious On Economy

Amherst (WBEN) -- Gas prices in Western New York are  below the $4 per gallon mark, and while still more expensive  than many places across the country, are falling fast.

According to the AAA, the national average price of a gallon of regular is down 61 cents since April, locally the average is down almost 26 cents in just one month.

"Anybody who has got more money in their pocket is going to be more happy and more disposed to thinking that the economy is turning around," says Bruce Fisher, a visiting professor at Buffalo State College and director of their center  for Economic and Policy Studies. "Gas prices are just the leading indicator of what we could see as a real big drop in the overall price of oil over the next two years which is going to mitigate a lot of the fallout of the financial crash of 2008." 

In turn, that could, boost President Obama's chances of re-election, provided that the jobs situation improves.

"The problem is even though gas prices are dropping people are still worried about the health of the economy . They are worried about their jobs, even though they have one now, they are worried about their job in the future," says Prof. Kevin Hardwick, a Republican county legislator who teaches political science at Canisius College.
 

On Friday, the website BuffaloGasPrices.com indicated prices ranging from an average of $3.65 per gallon on the high end -- to an average of $3.30 per gallon on the lower end.

We caught up with some drivers on Friday, like John Gusky from Cheektowaga who says gas is still expensive and wishes it was cheaper.

"It's something I really have to think about. I can't just drive around indiscriminately. I have to really budget how much I spend on gas," he says. 

Another driver, Kristina Fuller of Amherst, says she's noticed the price going down and feels it's providing a little bit of relief.

"My job situation changed, so my job location's actually closer now, so I'm not noticing myself filling up as much, but when I had to drive 30 minutes, and it would $60 to fill just a car's tank of gas, it was kind of getting a little hard," Fuller says.

Another driver from Tonawanda says her family is looking to downsize from their SUV because it is costly to fill up, and another driver from Buffalo says he's just become accustomed to gas prices between $3 and $4.

Until this week, gasoline had been on a steady decline, losing an average of 61 cents per gallon since the first week of April. Experts say the national average will likely range between $3.30 and $3.50 per gallon from now until Labor Day.

Oil rose slightly to near $85 a barrel Monday, clawing back some of a large drop from the previous session amid hope that weak U.S. economic growth may trigger new stimulus measures.

The Labor Department on Friday said the U.S. economy added 80,000 jobs last month, which was fewer than expected and prompted speculation that the U.S. Federal Reserve may implement more monetary stimulus measures known as quantitative easing.

Last week, the European Central Bank and the People's Bank of China both cut lending rates in the bid to boost flagging economic growth.

"We're still stuck in this mode of slow growth, which means weak demand," energy trader and consultant Carl Larry of Oil Outlooks and Opinions said. "We have seen the ECB and China both take aggressive measures to ensure economic recovery and stimulate growth. We will need the U.S. Fed to do something similar."