Gas prices fall, but drivers don't feel relief

Gas prices off as driving ebbs

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NEW YORK (CNNMoney.com) -- Gasoline prices may have fallen over the last 13 days, but the decline has offered little relief to long-distance commuters who still blanch at the pump every time they fill up.

Motorist group AAA says the national unleaded average was $3.926 a gallon on July 29. But for many drivers, a gallon of unleaded still costs more than $4. Gas still exceeds this psychological barrier in Washington, D.C. and 12 states, including California, where unleaded goes for an average of $4.288 a gallon, and New York, where it's $4.203 a gallon, said AAA.

"Having a long commute kind of comes with the territory and people in California love their cars," said Dan Leavitt, a long-distance commuter in Murietta. "I look for reasons not to drive. It's not bad enough to make a drastic change in where I live or my profession, but it's getting close to that point."

Leavitt, a video technician, lives with his wife and two children in a fast-growing California city of about 100,000. But like many of Murietta's residents, he has to travel far and wide for work. Murietta is located in the middle of the triangle formed by Leavitt's top commuting destinations: Los Angeles, San Diego and Palm Springs.

Leavitt moved to Murietta in 2003 from San Diego, one of the most expensive housing markets at that time. But he now finds that whatever he saved in housing costs goes right into his gas tank.

"One of the big draws here is that there are very nice big houses at very cheap prices, but that plan seems to have backfired," said Leavitt. "The benefits of having cheap housing are now outweighed by the downside of paying $4 for gas."

Leavitt said he used to spend $100 a week driving a Ford truck. Last year, he traded it in for a Scion wagon and doubled his gas mileage. But with current gas prices, he says he's back up to $100 a week.

The high cost of commuting is also noticeable in Oneonta in upstate New York. This city of 14,000 is located between the larger cities of Binghamton, about 60 miles away, and Albany, about 70 miles away. Oneonta Mayor John Nader said that many of his constituents - including his wife, Debora Marcus, regional chief executive for Planned Parenthood in Binghamton - commute to these cities. He said no one seems to have noticed any price declines at the pump.

"There's been a lot of grumbling in the last several days in the Oneonta area about gas prices," said Nader. "Oneonta is a rural part of New York where people rely heavily on their vehicles. Overall, rural New York is a low-income area and the gas prices have put a real burden on people who need to drive to work."

Peter Beutel, energy analyst at Cameron Hanover, said he's failed to notice falling prices at the pump in his home state of Connecticut, one of the most expensive states to drive, with unleaded gas averaging $4.214 per gallon, according to AAA.

"Here in Connecticut we have not seen prices come down, neither in Greenwich or Stamford or New Canaan," said Beutel. "We've got a situation now where we have seen some decline coming, but we're still owed a lot more."

Beutel said that wholesale prices for gasoline recently declined more than 50 cents a gallon, but these savings have yet to be passed on to the consumer. But even savings of that magnitude aren't going to make gas seem cheap, he said, especially considering a recent study from the Federal Highway Administration showing that Americans curbed their driving by 9.6 billion miles in May.

"I think people are going to wait until they see prices drop under $2 before they go out to haul 500 pounds of lead in a Suburban up a hill in the winter," said Beutel.