Gas prices continue to decline

It was just a few months ago that gas prices in San Francisco were hovering around $5 per gallon, but 11 straight weeks of declining costs have lowered that number by almost a dollar, AAA reported.

A strengthening U.S. dollar and a drop in demand are helping to keep prices down, experts say.

“Consumers are having a big influence on the gas market,” AAA spokesman Matt Skryja said. “Once gas started reaching the $4 mark, that was a wake-up call to a lot of people. They started to use mass transit. As it continued to climb, people changed their habits.”

Concerns about recent hurricanes slowing oil production in the Gulf Coast have not made a big impact on the market and investors seem to be ignoring military tensions that could threaten supplies in oil-rich countries, according to AAA.

In Balboa Park on Wednesday, a steady stream of drivers of drivers filled up at Best Auto Care, which boasted the lowest prices in The City at $3.83 per gallon.

“When the price drops, we get more customers, of course,” said owner Jim Li.

But the drop in prices haven’t translated to more cars on the road, Skryja said.

Muni spokesman Judson True said ridership on public transit remains high.

“We haven’t heard any stories of empty buses as the result of slightly lower gas prices,” he said.

John Cavanaugh, 34, says prices haven’t dropped enough to drive from his Berkeley home to his job in San Francisco. However, he says cheaper gas encourages him to enjoy more short trips.

“I’m taking more trips out to Walnut Creek on the weekend,” he said.

Whether prices continue to drop is uncertain.

“We’ve seen a very erratic market, so it’s hard to guess what may happen in the future. We have to keep in mind the weather, any conflict overseas, such as Iran and what’s going on in Russia and Georgia,” Skryja said.

While fueling up in San Francisco is still no bargain at $4.03 per gallon on average, it is down 28 cents from Aug. 12, according to AAA spokesman Matt Skryja. The Bay Area-wide average is $4.01, down 27 cents. Statewide, gas is now $ 3.85 per gallon, down 26 cents. Nationally, it averages $3.65, down 15 cents.

Taxes and environmental regulations make gas in California more expensive than other states. In San Francisco, high gas prices simply come down to what the market will bear, Skryja said. The dishonor of being the most expensive California city in which to fuel up goes to Eureka and Tahoe City, where a gallon of gas is $4.30.

tbarak@sfexaminer.com

Examiner Staff Writer Will Reisman contributed to this report.

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