GAS PRICES LEVEL OFF IN REGION.

Byline: Brent Hopkins Staff Writer

Gas prices have stabilized in Los Angeles, and should hold steady until summertime, industry followers reported Friday.

According to the Automobile Club of Southern California, pump prices dipped slightly for the second week in a row, leaving motorists paying an average of $1.625 per gallon for regular gas. Last week, they paid out $1.626, demonstrating rare stability in a market that has edged up from 99 cents per gallon in January. Though prices are expected to climb slightly near Memorial Day, they should remain far below their $2 peaks last year.

``Knock on wood and keep your fingers crossed, you guys should have a good summer,'' said Mark Mahoney, West Coast editor for the Oil Price Information Service in Lakewood, N.J. ``We feel that the market rallied a little early with all the problems in the Middle East. There was an anticipation that there'd be price spikes if production got interrupted because of what was going on there and in Venezuela, but then when none of those things happened, it's been drifting lower.''

According to Auto Club spokesman Paul Gonzales, prices will likely climb slightly about the time motorists typically start planning driving vacations.

``It's not too much of a stretch to say there would be an upward bump around Memorial Day, which is when the driving season starts. Things bode well for the near future, though. Anyway you look at it, when motorists have lower prices, they go out and do other things. That keeps the economy moving, and that's certainly a good thing.''

Even with an increased demand, production of California's specially formulated gasoline has been so buoyant the state enjoys some cushion from the spikes that have plagued it in the past. According to Mahoney, when California refineries completed their annual switch-over to summer formulated gas, no hitches occurred and production thundered onward.

``The refineries are running well and the scheduled maintenance went well during the change from the winter to summer gas,'' Mahoney said. ``Now, there's also steady flow of unfinished gas ready to be refined. For six weeks in a row, the output has outpaced last year, which is really healthy. On the wholesale market, it's about 40 cents cheaper than it was last year, too.''

Prices could even drop slightly, predicted wholesaler Bob van der Valk of Santa Fe Springs' Cosby Oil. He figures gradual declines of a few cents per week so any gains will be minimal come Memorial Day.

``We're as high as we can get,'' he said. ``The major oil companies are happy at this level because they can still make money day and night. There's more supply than demand in California, so even a big world situation wouldn't make prices go up.''

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SOURCE: AAA