Gasoline prices have been falling nationwide about 18 cents per gallon over the last five weeks, and State College has seen the effects from major companies and local competition.

The new Sheetz, 765 Benner Pike, is causing more competition and is driving prices down, said Gary Green, owner of College Heights Exxon, 803 N. Atherton St.

"They're losing money, I bet you," Green said. "I'm not in business to give [gasoline] away."

The price for regular unleaded gas at the Benner Pike Sheetz is $1.29.

Richard Trialonas, manager of Snappy's, 1209 N. Atherton St., also said the new Sheetz is giving him some competition.

"If [Sheetz] sold their gas for a dollar tomorrow, we wouldn't do it," Trialonas said.

"Competition drives prices down to a degree, but no, we're not going to give it away," he said.

Yesterday, local gas prices averaged about $1.39, according to a survey of gas stations.

There are a lot of factors that went into the rise of gas prices earlier in the year.

"The cost of gasoline prices went up because of problems in Venezuela, the Nigerian oil companies being on strike, a cold winter and the Iraq situation," said John Felmy, chief economist of American Petroleum Institute, located in Washington, D.C.

"Now all of those problems are reversed," he said.

Another factor that goes into the rise and fall of gasoline prices is the Organization of the Petroleum Exporting Companies (OPEC).

"They are the dominant producer in the world," Felmy said. "A lot depends on what OPEC decides to do."

If production of gasoline goes down, prices could go back up, he said. But if not, there will be very little impact.

The price in making gasoline is also a factor in lowered prices.

Crude oil is the most important aspect in making gasoline and the price has dropped to about 28 cents per gallon, Felmy said.

About 42 percent of the cost of making gasoline comes from crude oil and 30 percent comes from state and federal taxes, Felmy said. The other 28 percent is transporting the oil from the Middle East to the United States, he said.

Local gas stations are not sure why the prices are cheaper in smaller cities, like State College, compared to places such as Philadelphia, Pittsburgh and New York City.

Tim Considine, professor of natural resource economics, said there are two reasons for lower prices in a small city like State College.

"A lot of big cities have separate local taxes on gasoline, sometimes five to 10 cents per gallon," Considine said.

The second reason is the environmental regulations. Air quality is worse in big cities so distributors are forced to blend their gas with additives like methanol, which give gas higher oxygen content, allowing it to burn cleaner, Considine said.

"The most expensive types of gasoline are used in places like Philadelphia and Pittsburgh," Felmy said. "They both use reformulated and specialized gas that is used because of pollution reduction plans and the clean air act."

Trialonas said he thinks it is strange that prices are so much lower in State College.

"I have relatives in New York that are paying over [$1.80] for a gallon of gas," he said.