In my comment to Oil markets ambivalent after King Abdullah's death, I observed that "[t]he news may not be moving oil, but it is moving gasoline. In fact, it seems to be the excuse needed for retail gasoline to begin its seasonal rise, which is a month late." My remarks extended what I wrote in the body of the entry itself.
When I drove through my old neighborhood, those three stations were still selling regular for $1.75, although the corner station had charged into No Man's Land for the second time since my previous report to $1.99. The previous advance ended with an ignominious retreat to $1.75, but I'm not so sure this one will. GasBuddy shows an actual price spike in the Detroit market, with the average price rising from $1.83 on Wednesday to $1.90 on Friday--this after hitting a low of $1.81 on the 15th, followed by a week of stability at $1.83. A price of $1.79 to $1.85 would be much more in line with the local price environment than $1.75, so I expect prices will start rising. It's about time; the gas price roller coaster usually begins its ascent in late December.Sure enough, when I drove through my old neighborhood yesterday,* the corner station was holding its position at $1.99. No ignominious retreat there. Meanwhile the three stations down the street were all selling regular for $1.89. That's actually higher than I expected. In fact, when I checked GasBuddy yesterday, the Detroit average was $1.94, where it stands today. It's actually a few cents too high; the $1.85 I predicted would have been more in line with the local price environment. Just the same, I don't expect those three stations to lower their price, although the old corner station will probably match them by the end of the week.
The national average has also stopped falling and appears to be on the way up, hitting $2.03 a couple of days ago and rising to $2.04. I expect that will be as low as it gets all year, if not until the depths of the next recession.
Oil-Price.Net suggests that crude may finally have stopped its fall, too. Brent has been rising steadily from a low around $46 a couple of weeks ago and closed yesterday at $49.60. WTI, which continued to drop after King Abdullah's death finally rose yesterday after hitting a low just about $45, closing at $46.23. In the short term, it may be a dead cat bounce. In the longer term, I expect it to follow Brent up.
*Likely for the last time that involved passing by my former residence. I'll have more on that later.