Gas falls three times in one week

Here's where prices stood when I posted Prediction salvaged with bonus fuel economy and emissions news on Thursday evening of last week.

I managed to save my best prediction from Gas falls faster and farther than I expected.

[W]hile the third station down the street did match the rest at $3.65, the corner station did not.  Yesterday morning, it dropped to $3.67, but by yesterday evening, it had lowered its price to $3.59.  It passed right by $3.65.  Now, I can still save my prediction if the three stations down the street are also at $3.59, so at least it will have matched them, but I haven't checked yet.

I drove by the stations and they are all at $3.59, so my call that the corner station will match them by the end of the week came true despite not getting the price right.

Since then, the neighborhood price has fallen three times and now stands at $3.44.  That's much farther and faster than I expected when I wrote "the current conditions may be favorable for at least one more drop, possibly as early as next week, before they plateau or rise slightly."  Good thing I conditioned my prediction with "at least."  As for the decline stalling out, I would expect it at these price levels for this time of the year, but it's too soon to tell for reasons I'll explain over the jump.

The price first fell on Friday, when I was leaving for Netroots Nation and the water protests.  All of the stations had lowered their price for regular to $3.55, including the corner station.  That alone would have made my prediction of "at least one more drop, possibly as early as next week," come true.  The three stations down the street weren't finished.  They lowered their price to $3.48 on Monday.  The corner station held firm at $3.55 until Thursday, when they finally crept down to $3.52.  By that time, the three stations down the street decided to play limbo by lowering their price to $3.44.  They didn't even bother to wait for the corner station to match them at the previous price level.  This morning, I checked the corner station and it had dropped all the way down to $3.44.*  That's why it's too soon to tell if a plateau has been reached from just observing the local stations; the last drop only happened today.

That's why I'm going to look at GasBuddy.  The site shows the national average is still continuing to go down to $3.53 from last week's $3.58 and the Detroit average has continued to chase it, diving from $3.71 to $3.51.  Detroit is now slighly below the national average.  These trends indicate continued lower prices, although I expect price resistance at $3.39 based on what I recorded last year in Gas prices begin August by bouncing off the post-spike bottom.  I could see prices settling at $3.35 between now and Dream Cruise, but lower than that would surprise me.

The situation at the wholesale level indicates that these relatively low prices could continue, as The Wall Street Journal reports in Oil Prices Slip as Traders Mull U.S. Supplies, Global Crises.

Oil prices ended lower Thursday despite shrinking U.S. crude supplies and crises in Eastern Europe and the Middle East.

Light, sweet crude for September delivery fell $1.05, or 1%, at $102.07 a barrel, the lowest closing price since July 16 on the New York Mercantile Exchange. Brent crude on the ICE Futures Europe exchange fell 96 cents, or 0.9%, to $107.07 a barrel.
...
Front-month August reformulated gasoline blendstock, or RBOB, lost 2.33 cents, or 0.8%, at $2.8368 a gallon. August diesel lost 0.45 cent, or 0.2%, to $2.8709 a gallon.

Both crude oil futures are up, but wholesale gasoline is down.  In the short run, the gasoline futures win.  Prices are not going up and may continue to go down.

*The corner station did something odd.  It was advertising the next grade at 30 cents higher instead of 15--that or it's advertising the price of the highest grade; I couldn't tell from two blocks away.  I'll double-check that later.