Ron Planting

While the price of crude oil has dropped more than $20 a barrel recently, the pump price of gasoline may be slow to follow.

Ron Planting, an economist at the American Petroleum Institute, said that isn’t unusual.

There tends to be a lag in either direction, Mr. Planting said. “Retail prices tend to move more slowly than crude prices in both directions.”

Crude prices peaked July 3 at $145.29 a barrel, which was an increase of about 25 cents a gallon from June 20, but Mr. Planting said retail gasoline prices increased only about 3 cents a gallon on average during the same time.

Oil prices dropped to their lowest level in weeks Friday with futures trading around $123 a barrel on the New York Mercantile Exchange.

According to AAA, the average price of regular unleaded in Chattanooga on Friday was about $3.86 a gallon, down about 2 cents from a month ago.

Steve Ray, owner of the Midnite Oil station in Ooltewah, said retail gasoline prices could reflect drops in crude prices almost immediately. It takes about a day for the price he pays his Midnite Oil supplier to reflect drops in crude prices.

“It’s a pretty quick turnaround,” he said. “It’s really up to each individual dealer and company. We try to stay competitive with what others are doing around here.”

On Friday, Mr. Ray was selling a gallon of regular unleaded for $3.78, which he said is a 14 cent drop from $3.92 a month ago.

Randy Bly, spokesman for AAA, said when crude prices were spiking, some stations raised prices immediately, while others were hesitant to do so because they are afraid of losing customers. The reluctance now to drop prices along with the falling price of crude may be an attempt to recoup losses they incurred when crude prices were up.

When crude was selling for $147 a barrel, Mr. Bly said gasoline prices would have been close to $5 a gallon if it truly reflected the crude price.

“It was never totally passed along to the consumer anyway,” he said.

Mr. Planting said retail gasoline prices are dropping fairly drastically. He pointed to a 2 cent drop from Thursday to Friday.

“That’s the largest one day decline since at least a year ago,” he said.

But Mr. Ray said consumers should enjoy lower prices while they can.

“It Iran tests another missile or if something happens in Israel, it’s going to go back up,” he said. “This market is so fragile.”

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