It's prediction checking time again. In Another advance in the gas price war, I described the latest action in progress in the local gas price war.
Monday, the corner station charged into No Man's Land, shooting its price up to $3.89, which meant that the price for the next grade up was $4.04. Egads, $4 gas again! Meanwhile the stations down the street were still at $3.60. Tuesday evening, they had all raised their prices for regular to $3.65, while the corner station had dropped what they were charging for regular to $3.79. My prediction that the neighborhood price would go up to $3.64-$3.69 has come true. Now all that's left is for the corner station to match the other three, something that should happen by Thursday.That's exactly what happened. Thursday night, I drove past all four stations. The three down the street were still at $3.65 and the corner station had joined them. Success!
How about the next prediction?
The next question becomes what is GasBuddy indicating for the trend? The national average has continued up slowly and is now between $3.61 and $3.62. The Detroit average bounced up on Monday to $3.75 and is now between $3.76 and $3.77. Even if the latter price ends up being the peak for the week, so long as the slow decline that would follow keeps the price above $3.75, the neighborhood stations will still be underpriced and I would expect the next jump would be to $3.69. That could happen this weekend to take advantage of Easter weekend travel, but I would think it more likely early next week. Stay tuned.The national average is still creeping up and is now between $3.62 and $3.63. Meanwhile, the Detroit average has dropped below $3.75. The neighborhood stations are no longer underpriced, so I no longer think they'll raise prices before the Easter weekend. The earliest move should be early next week. Based on the national average continuing its steady rise, I still think $3.69 is in the cards. A price rise higher than that shouldn't be, as crude oil has been bouncing around while moving mostly sideways the past few days, as Reuters reports Brent oil falls as Ukraine, Russia seek to end violence.
Brent crude for June delivery, which has received support in recent days as violence in Ukraine escalated, settled down 7 cents at $109.53 a barrel, after earlier hitting a high of $110.19 ahead of the joint statement.So crude oil is stalling out. So far, RBOB gasoline isn't, as the Wall Street Journal reports.
U.S. prices found support from strong U.S. employment data, which showed new applications for unemployment benefits close to a 6-1/2-year low, the latest sign the economy of the world's largest oil consumer is gaining momentum.
U.S. oil for delivery in May settled up 54 cents at $104.30 a barrel, after earlier hitting a high of $104.78 a barrel. The contract had touched a six-week high of $104.99 in the previous session, though a report showing a large build in stockpiles weighed on sentiment on Wednesday.
Gasoline supplies fell slightly last week to 210.3 million barrels, the lowest level since November, the EIA said. Stocks are "lower than they ought to be for this time of year," ahead of the summer-driving season, Mr. Lebow said.Based on that wholesale price, gas won't stop at $3.69 after next week, no matter what crude oil does.
Front-month May reformulated gasoline blendstock, or RBOB, rose 1.42 cents, or 0.5%, to $3.0547 a gallon, the highest price since Aug. 29, 2012. Prices are up 1.3% for the week.