PLUNGING GASOLINE PRICES aren't yet prompting drivers to fuel up and hit the highways, gas-station owners say, but the lower prices are helping to boost station operators' profitability by lowering their costs.

Gas prices have dropped by almost 90 cents at the pump the past month to a U.S. average of $2.858 for a regular gallon on Wednesday, according to auto group AAA.

Though demand has edged up a bit the past two weeks, it remains down 3.3%, compared with year-ago levels, according to weekly data from the federal Energy Information Agency.

"It doesn't look to me like demand is rushing back," said Tom Robinson, president of Robinson Oil Corp., an independent gas retailer based in San Jose, Calif.

The poor economy and fears that it could worsen are keeping consumers in a fuel-conservation mode. It will also take time for drivers to recover from the shock of $4-a-gallon gas, said Paul A. Weissgarber, an energy expert at consulting firm A.T. Kearney.

Still, cheaper gas is easing the pressure on gas retailers, who couldn't increase their prices as fast as suppliers did. With prices coming down, the lag works in their favor. It now costs retailers less to buy a tanker-load of gas, which they say is especially welcome at a time when it is hard to borrow money.

Credit-card fees, a major expense for retailers, also are lower now that gas is cheaper.

For much of this year, many gas retailers were hard pressed to make a profit because, from mid-February to mid-July, gross margins averaged about 10 cents a gallon, according to data compiled by Oil Price Information Service together with AAA and Wright Express, a firm that provides payment-processing services. From that, retailers had to subtract credit-card fees, which were about 12 cents a gallon when gas was at $4, and operating costs.

In recent days, gross margins have been closer to 40 cents a gallon.

Write to Ana Campoy at ana.campoy@dowjones.com