Isle gas prices slowly drop

But the downward trend could be ending as oil prices spike

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Hawaii gasoline prices have been in slow decline over the past two months and even dropped below $4 a gallon in at least one location, but that trend could soon be over.

Last week, AAA Hawaii reported that the average price for regular, self-serve unleaded in Hawaii had declined for the eighth straight week.

Prices already had gone as low as $3.84 a gallon for regular unleaded at Costco yesterday.

Yesterday's statewide average of $4.28 a gallon was the lowest price in the islands since mid-June, but still second-highest in the country to Alaska's $4.30 a gallon, according to AAA's Fuel Gauge Report.

Hawaii gasoline prices historically are higher than on the mainland and follow trends at a slower pace.

Yesterday's national average for regular self-serve unleaded was $3.74 a gallon, down 2 cents from the previous day.

But the downward trend is in danger after crude oil prices spiked more than $25 a barrel yesterday.

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After a summer of $4-plus gasoline, Hawaii's pump prices showed signs of potentially dipping below the barrier by next month.

A look at prices A look at trends in gas prices in Hawaii and across the country. Prices are per gallon for regular, self-serve unleaded. National average Yesterday: $3.739 Last week: $3.854 Last month: $3.692 Last year: $2.810 Hawaii average Yesterday: $4.281 Last week: $4.305 Last month: $4.418 Last year: $3.213 Honolulu average Yesterday: $4.194 Last week: $4.305 Last month: $4.322 Last year: $3.102 Source: AAA Fuel Gauge Report

Prices already had gone as low as $3.84 a gallon for regular unleaded at Costco yesterday.

On Friday, AAA Hawaii reported that the average price for regular, self-serve unleaded in Hawaii had declined for the eighth straight week.

"This is relief to Hawaii drivers because prices have been amongst the highest in the nation and we hope there is more relief in the near future," AAA Hawaii Regional Manager Richard Velazquez said in a news release.

The downward trend could be coming to an end as crude oil prices spiked more than $25 a barrel yesterday, shattering the record for the biggest one-day gain amid investor concerns over the government's $700 billion economic bailout plan.

Light, sweet crude for October delivery jumped as much as $25.45 to $130 a barrel on the New York Mercantile Exchange before falling back to settle at $120.92, up $16.37 from Friday's closing price.

Given the dire economic outlook, some analysts questioned whether oil prices would keep rising.

"We've already seen that the world can't afford oil at these prices. If it keeps going up, demand will drop off again," said Phil Flynn, an analyst and oil trader with Alaron Trading Corp. in Chicago.

However, he cautioned that oil's future direction hinged on the outcome of the government bailout plan and its effect on the U.S. economy.

Yesterday's national average for regular self-serve unleaded was $3.74 a gallon, down 2 cents from the previous day.

Yesterday's statewide average of $4.28 a gallon was the lowest price in the islands since mid-June, but still second-highest in the country to Alaska's $4.30 a gallon, according to AAA's Fuel Gauge Report.

Hawaii gasoline prices historically are higher than on the mainland and follow trends at a slower pace.

The national average dipped below $4 a gallon on July 26, and went as low as $3.65 in August before steadily rising again. Crude oil during that time went from $124.73 a barrel to as low as $91.15 a barrel last week.

Since July 26, Hawaii's prices have slowly but steadily declined from $4.49 a gallon to yesterday's price of $4.28.

By comparison, when the national average first hit $4 a gallon on June 8, it marked a 35-cent increase over the preceding month.

Hawaii's statewide average first topped $4 on May 23, increasing 22 cents in the preceding month.

Oil companies have long maintained that Hawaii's higher prices and slower-moving trends are a result of the market's isolation and higher costs of doing business. Critics have argued that oil companies keep prices artificially high to take advantage of the small market in the islands.