In yesterday morning's Gas prices set new lows for year, I made a confident prediction.
This week, as predicted, gas prices have continued to fall, setting new lows for the year. On Monday, the three stations down the block lowered their prices to $3.17. Yesterday evening, the corner station joined them. That means that the corner station is only two cents above its low for last year and the rest are nine cents away from their lowest price for 2012. I expect the corner station will fall below $3.15 by Thanksgiving, while the rest will fall below $3.08 soon after.The first has already happened and the second might happen as soon as next week. This evening, I saw that the corner station had lowered its price to $3.09, the lowest since at least December 2011. That makes it the lowest since I've been keeping track. I promptly drove over to the three stations down the street. They were also at $3.09. That means they are only a penny above their low for last year.
The question now becomes the one being asked in the cat macro--How low can we go? Right now, the best answer I have comes from the GasBuddy widget at Econobrowser, which shows the Detroit average at just above $3.16 and still falling. The local stations can be as much as a dime below the metro mean, so $3.06 would be my next target.
After that, I'd look to crude oil prices. While WTI seems to be bouncing off a floor of $94.00, the lowest they've been for five months, it's Brent that drives gas prices, and it dropped like a rock yesterday, falling $1.78 (1.72%) to $103.46. That's the lowest they've been in five months and also five to seven dollars lower than they were last year. If that keeps up, prices might go a dime lower than last year's low. $2.98 by Christmas, anyone?