Franklin County

A bit of relief: falling gas prices

Sometime after 3 p.m. Tuesday, Pioneer Market owner Ed Johnson changed the gas prices outside his store south of Harrodsburg from $3.259 to $3.199 for a gallon of regular unleaded.

It didn't take long for cars to start pulling off U.S. 127.

When prices drop, "just be sure you have enough help on hand because it's going to generate extra traffic flow for a little while," Johnson said.

Motorists around Central Kentucky expressed relief Tuesday at the falling pump prices, a rare bit of happiness in an economy that is otherwise crumbling.

The Dow Jones Industrial Average, for instance, fell another 500 points Tuesday, and the Standard & Poor's 500 index closed below 1,000 for the first time in five years.

But even while smiling at the pump, Central Kentucky drivers said they doubted the lower prices will stick around.

"I think when we really get into the cold weather, you're going to see it shoot right back up again," said Donna Lamb of Paint Lick after she bought gas at Shell Express in Lancaster.

"Any time you can save money, especially as high as groceries and things are, you've got to save it everywhere you can," Lamb said. "If it puts 5, 6, 7 or 8 cents in your pocket — it's as good in my pocket as it is in the rich oil man's."

Oil prices have tumbled about 40 percent since peaking at $147.27 a barrel on July 11. A drop below $85 a barrel is considered an almost certainty in the current environment. Prices on Tuesday rose slightly to $90.06 a barrel, but analysts say they will continue to head lower.

"We've just seen a huge shift in sentiment where the focus isn't on supply anymore. It's on demand, and that demand continues to weaken," said Jim Ritterbusch, president of energy consultants Ritterbusch and Associates in Galena, Ill.

In India, domestic oil product sales totaled 2.41 million barrels a day in August, the lowest level this year, while Japan's oil demand fell by 8.4 percent in the same month, according to Barclays Capital research.

The lower oil prices have already meant huge drops in gas prices in some areas around Central Kentucky. Gasoline was $3.109 on Tuesday at some stations in Frankfort and was available for $3.009 with a Kroger card that had more than $100 in purchases for the month.

In Lancaster, Shell Express owner Sean Abraham said lower prices have translated into more interest inside his store for soda, snacks and candy.

"You could tell the difference. They had extra to spend," Abraham said. "If the gas prices go down, this country's economy will get in a whole lot better shape."

But customer Greg Montgomery of Lincoln County isn't so sure. Taking time off from a pipeline construction job in Illinois, Montgomery said prices weren't dropping fast enough for him.

"This little change isn't going to make that big a change in a man's budget." Montgomery said.

And on Lancaster's east side, Gary Hammonds noted that he's still paying just under $4 a gallon for diesel for his truck. That hurts when he takes loads of grapevines to a Clay County craftsman.

"It's affecting the billfold bad, real bad," Gary Hammonds said. "We have no extra money for nothing. You've got to put it all in your tank."