Brad Harper

Montgomery Advertiser

Fueling up for a Fourth of July vacation? You may want to do it in Montgomery.

Alabama’s capital city was the third cheapest place in the nation to buy gas on Tuesday morning at an average of $3.35 per gallon, according to GasBuddy.com. And prices were still falling.

Gas here has dropped nearly 10 cents since June 20, defying a trend that’s seen pump prices rise across most of the nation in that time. Gas Buddy was predicting the nationwide average on July 4 to be higher than any time since 2008 because of upheaval in Iraq.

But a strong refinery supply line has helped keep prices down along the Gulf Coast, said Gas Buddy Chief Oil Analyst Tom Kloza.

“We have seen wholesale prices drop on the Gulf Coast in the past week,” Kloza said. “But the national numbers aren’t moving.”

The five cheapest average gas prices in the nation Tuesday were all in the Southeast, with Alabama ranking No. 2 behind South Carolina.

He said competition among gas retailers in Montgomery may have kept them from fully matching the brief spike in Gulf wholesale prices last month, and put pressure on them to lower prices even more when wholesale started dropping.

“Sometimes you get these price wars, and it happens,” Kloza said. “It’s not quite man bites dog because we are seeing a drop in wholesale prices.”

At the same time, ethanol prices have plummeted because of a record forecast for corn. That’s allowed retailers here to charge even less.

Still, Kloza warned that there could be storm clouds on the horizon for Montgomery motorists. With its heavy dependence on Gulf Coast refineries, central Alabama is susceptible to quick and prolonged price spikes during hurricane season.

“That’s the next thing to watch for,” he said. “I know it’s already hurricane season, but I really start paying attention to it in August.”