Wednesday, October 29, 2014

The limbo bar drops four cents to $2.93

I'm glad I didn't specify what I meant by "soon" in Gas ticks downward once more.
[T]he Detroit average is $3.01.  No wonder the local outlets dropped their prices.  Somehow, I doubt they'll go to $2.91 soon, but $2.89 sometime in the next two months looks very likely.
Today, the three stations down the street lowered their prices to $2.93.  That's a surprise, but at least it's not $2.91.  I dodged that bullet by only two cents.  I have until the end of this week to not have to eat my words on the price.  As for the corner station, it's only a matter of time before it matches the rest.

As for what to expect next, GasBuddy shows the national average is still $3.03, but just barely.  The Detroit average has finally fallen below $3.00 and is now just above $2.99.  As George Takei would say, oh my!  I might see $2.89 sooner than I thought.

Before I look at commodity prices to see what they foretell, I'm going to share this video from PBS Newshour asking What's behind the sudden drop in US gas prices?

According to AAA, the average price of a gallon of regular gas in the U.S. dropped from $3.52 in late July to $3.12 today. Isaac Arnsdorf, an energy and commodities reporter with Bloomberg News, joins Hari Sreenivasan to explain the factors contributing to the drop.
Yes, it's a week old, so the gas price data are out of date, but the analysis of what happened and what it means are still valid.

Follow over the jump for the latest in crude oil and wholesale gasoline prices from the Wall Street Journal.

Oil Ticks Higher as Dollar Weakens
Oil prices edged higher Tuesday as the dollar fell and conflicting U.S. economic data kept markets in a holding pattern.

Light, sweet crude for December delivery rose 42 cents, or 0.5%, to settle at $81.42 a barrel on the New York Mercantile Exchange. The global Brent contract rose 20 cents, or 0.2%, to $86.03 a barrel on the ICE Futures Europe exchange.

Nymex crude held up for a second day after dipping below $80 a barrel on Monday, with some analysts saying they believe the tailspin that has dragged U.S. and global oil prices down by about 25% since mid-June appears to be over for now.
Nymex gasoline and diesel futures gained, although both contracts remain near the lowest prices in almost four years. November gasoline rose 2.59 cents, or 1.2%, to settle at $2.1961 a gallon, and November diesel rose 1.78 cents, or 0.7%, to $2.4931 a gallon.
Looks like the $80/barrel is acting like a good floor for WTI and Brent may have climbed back up to a support level of $85/barrel.  Let's see how long they stay there.   I suspect at least until the end of the year.  Stay tuned.


  1. Replies
    1. That's a good price for California, which is almost always the second most expensive gas in the U.S. (Hawaii usually has that honor). It's a lot cheaper in New Jersey, where a friend of mine has reported on Google Plus that he can get it for $2.60, and that's full service. Pumping your own gas is illegal in NJ.