Gas Prices May Remain Stable Through The End Of The Year
Take out the keys, throw open the garage, gas prices may soon end their wallet-busting ascent. Analysts armed with charts and calculators think gas prices may camp for the rest of the year around the $3 mark. Of course, hurricanes or explosions can wreak havoc on estimates and refineries, but barring interference from terrorists, careless workers, or Mother Nature, the worst may be over. From the L.A. Times:
The decline was based in part on the resumption of production at an important oil facility in Angola, analysts said. The drop also followed comments by officials of the Organization of the Petroleum Exporting Countries indicating that the cartel thought that oil prices above $60 to $65 a barrel were too high and indicating a willingness to boost production.Thanks for the good news, OPEC. See you on the road.Analysts said it wasn't clear whether OPEC would increase production before the end of the year. But they noted that the comments signaled a shift from just the last week, when cartel officials were saying crude supplies were adequate.
"That's an important change of rhetoric from the cartel," said Phil Flynn, vice president and senior market analyst for Alaron Trading Corp. in Chicago. "That sudden change was the big news in oil markets today."
Worst of '07 may be over at pump [L.A. Times]
(Photo: bradley j)
Post a comment
Comments:
Lies, all lies.
Besides, stable at $3.00 a gallon is like the government saying, We're aren't going to raise the income taxes bast 40%.
"the worst may be over."
Good thing the worst may be over...since prices hovering at $3/gallon is no big deal and only the highest I've since Katrina.
Highest I've (paid)
Oh. Goodie. Pardon me as I bust out the party hats to celebrate gas staying firmly at the highest price it's ever been.
Great, my ass is still recouping from the first burst. When will the soothing decent start?
I definitely agree with the rest of you: why would I want to celebrate hearing that a ridiculously high price is here to stay (until the next "refinery fire" of course)? Between this and milk (of course these two are connected via ethanol) I'm starting to wonder what I'm going to do.
I love how it says "Unless there's a hurricane, or anything else really, it'll stay where it is..."
What they mean is "Well, the next time something happens, look for another price jump..."
Gas prices went down quite a bit recently, though... I know in our area, regular is down to around $2.83, and when we just drove through NJ, we saw all sorts of places at $2.72.
I'm not saying it's low, but the prices are not the highest they've ever been, either.
"Information obtained through May 2007 continues to indicate that the 2007 Atlantic hurricane season will be much more active than the average 1950-2000 season." - Philip J. Klotzbach[1] and William M. Gray, Colorado State University
[typhoon.atmos.colostate.edu]
On the other hand Hurricanes Rita and Katrina went through heavy oil (gas?) production areas and it didn't seem to do a damn thing. We stockpiled some gas and if anything the price went down for a few months. Shrug.
Although I don't really enjoy paying 3 bucks a gallon, it really isn't that much when you consider the rising costs of everything for the past 20 or 30 years. It certainly wouldn't seem so much if the price hadn't gone up so quickly.
I just filled up at $2.69/gal where I live north of Seattle. It's gone down almost 50 cents in the last 5 weeks. Not sure why....
Wow - these analysts make "bold" predictions about the price of gas, and then hedge with disclaimers like "assuming no major hurricanes in the Gulf of Mexico" or "assuming stability in the Middle East". - as if all the risk associated with getting oil from far away into gas in my neighborhood has suddenly disappeared.
The truth is, nobody really knows. Gas currently costs me 15 cents a mile. If it jumps to 25 cents a mile, I'm not going to walk to work; but I might write things on a list and make less trips.
So at this time next year, will prices remain steadily below $4? Here's hoping.
Gas prices have increased by 300% since I started driving 10 years ago. I'd say that is NOT your average price of inflation. I remember being able to fill up a 14 gallon tank for less than $12...now my 11 gallon tank costs $30+.
I'm with Ray Wert...I can accept inflation if my salary jumps at the same time, but it doesn't. I'm just expected to make the small amount I earn stretch farther every time prices inflate.
I drive 20 miles to work every day, and I've started seriously considering investing in a bicycle to cut down on gas expenses. I HATE bicycles, but these ridiculous prices are even worse.
The have jumped 300% since I started driving as well.... But before that, it didn't increase that quickly. For years and years I remember it being around a dollar a gallon.
@DBEAHN: How prophetic.
A gas plant just blew up in Dallas. Let's see where the prices go...
Of course, hurricanes or explosions can wreak havoc on estimates and refineries, but barring interference from terrorists, careless workers, or Mother Nature, the worst may be over.
Or if a fish sneezes in the ocean, it'll go up again too. Whatever reason they can get for hiking gas prices, they will.
Gas was around $2/gallon in the UP of MI last summer. Just a couple weeks ago it got down to $3 after some all-time highs and overnight it went up to $3.49. It's now back down to $3.19. What happened to the predictions of gas rising until Labor Day then coming back down? That sounds more like the greedy oil companies to me (gouge for the summer and the last long weekend then have smooth sailing for the last part of the year).
Oh Im sure they will find some way of fucking this up so we have to pay more.... oh look
OMG. Celebrate!!! Everyone buy 7 SUVS and drive them across the street to their neighbors houses! Yay! Thank you oil companies and hedge fund speculators! You are true heroes! We knew you could do it!
P.S. I hope anyone who is involved in selling/buying oil futures dies of cancer and their children get AIDS.
The average car costs $25,000. If you can afford that, then $3.50 a gallon gasoline should be nothing to your budget.
Sigh...I got my DL a few weeks before the first oil embargo...I could fill up my hand-me-down car for under 5$/tank.
I'm not so worried about gasoline prices. I just use my car to commute, about 6 miles a day, so a tank or so is good for about a month.
I'm more concerned about winter heating oil. Last year we paied around 2.50$ a gallon on a contract. This year, the company may not offer contracts, so we'll be charged the going rate. Yikes...
Some of us invest in energy futures as to not feel the full brunt of the price spikes. It's a little thing called "hedging" if energy prices shoot up 30%, my energy investments will rise accordingly, thus minimizing the impact of said increase.
But being savvy seems to warrant bodily harm to my family, so thanks for the heads-up.
@ Carey
Context, baby, context.
The title "Prices may remain stable through the end of the year" needs the little disclaimer that they will be stable at what is v.close to the highest US price ever, EVEN adjusting for inflation. Kinda like when you fall out of a plane without a parachute - after a few thousand feet you've achieved terminal velocity and Hey! you're not speeding up any more! Now about that ground...
It's the panicky BUYBUYBUYBUY mentality of speculation that is partially responsible for the artificial rising of oil prices. Why else would oil prices spike with NEWS of conflicts in oil producing countries, especially when there is no effect on output?
Jackass 'at home investors' who watch too much "Mad Money" on TV BUY at the drop of a hat to 'hedge' the prices in anticipation of the increase so they can sell it off and proudly proclaim that made $1.73 on that transaction.
Apparently being a successful Investment banker makes me a "jackass at home investor." Interesting...
It becomes apparent that you have very little knowledge of how the futures markets work, and the types of investors that have there hands in commodity trading if you think that "jackass at home investors" have any more than a barely measurable impact on the price of a gallon of gas. Commodities and futures are traded in large part by sophisticated and savvy investors, many times on behalf of these "jackasses." To say that there is any noticeable change occurring from an at-home investor who wouldn't know how to read a commodity quote only points out your ineptitude toward the markets that you comment about with such confidence.
Most of the trading on commodity and future exchanges is done by those with investment discretion, that is, they are not being told by their layman clients what to buy and sell, but instead are reacting to trends or speculation of trends in the markets, and (at least for the majority) are savvy to the forces at work.
Watching Bloomberg instead of Mad Money does not make you smarter, just less entertained...
Lower this year than last year at this time.
The story essentially says: "gas prices will stay the same, unless they don't"
anyone else besides me even partially wonder why they build the refineries in hurricane zones, but don't put some sort of rounded rain/wind shell around them? what design sense does it make to fully expose every vital piece of an oil rig? It's like building your whole house with no walls.
I remember when gas was 89¢ November 2001. Hmm. You'd think invading an oil-rich country would've been helpful, not causing an increase in price to over triple.
This just in... Oil securities analysts in collusion with oil companies, tell consumers to not shit their pants this week. Next week middle class soccer mom husbands will buy charmin securities.