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GREENSBORO - Gasoline prices in the Triad have dropped nearly 50 cents a gallon since mid-July, but what happens next could depend on Gustav.

The tropical storm, which was temporarily downgraded from a hurricane Wednesday, could gain strength as it moves away from Haiti. Weather forecasters said Gustav could threaten the Gulf of Mexico, where the U.S. has a quarter of its oil installations.

Oil prices rose above $117 a barrel Wednesday amid warnings that Gustav could become a Category 2 hurricane today.

Travel officials couldn't say Wednesday how the storm might impact Labor Day gas prices.
"That's the big question," said Carol Gifford, public relations manager for AAA Carolinas in Charlotte. "The concern is that if it is headed for the Gulf, it could impact oil producers in that area."

Prior to Gustav's appearance, gas prices nationally had fallen for 39 consecutive days, AAA officials said.

In the Triad, prices averaged $3.57 for a gallon of regular unleaded on Wednesday. At several stations in Winston-Salem, prices had dipped to $3.39, according to NorthCarolinaGasPrices.
com. In Greensboro, the Web site reported a low price of $3.47.

On Labor Day a year ago, prices in Greensboro averaged $2.65 a gallon. The average peaked at $4.02 on July 17.

The next day, the cost of diesel hit a high of $4.77. On Wednesday, it had dropped to $4.29. So what happens next? Will prices continue to fall, or will the storm cause them to spike?

"It's going to be interesting," said Doug MacIntyre, an analyst with Energy Information Administration in Washington. "We have sort of seen oil prices steady until the last couple of days. That could mean we are pretty close to the end of the decline."

Barring storm damage in the Gulf, MacIntyre said, gas prices could drop another 10 cents over the next two weeks.

Contact Donald W. Patterson at 373-7027 or don.patterson@news-record.com