Are gas prices peaking? I doubt it!
The Energy Information Administration is predicting that average gas prices will be around $2.95 per gallon for regular this summer. The EIA is the statistical branch of the Energy Department. They are predicting a peak around Memorial Day (how convenient!) before a dip through June and July and an upward swing again in August. A likely scenario is a post Memorial Day dip when the oil companies will again report record profits, and as soon as the United States of Amnesia returns, the price will head up to new highs. Given that analysts are forecasting that Americans will be driving an average of 8.5 billion miles per day this summer compared to 8.4 billion last year, it is probable that any dip will be short-lived at best. Of course any sustained increase in prices will drive more people to more efficient vehicles or fewer miles, either of which is a good thing in the long term.
[Source: USA Today]
Reader Comments (Page 1 of 1)
Mulad 1:46PM (5/10/2007)
I was unaware of this until recently, but the folks at ABG may want to add the EIA website to their list of normal targets hit each week: http://www.eia.doe.gov/. One thing they've noted in recent weeks is a steep decline in refined gasoline stocks, apparently a result of some refineries going offline. Gasoline inventory is now well below the average range, so the prices swung upward. Diesel operations weren't hit as hard, so those prices have actually gone down in the last three weeks.
It sounds like gasoline production has ticked up again, so that will probably mitigate prices for a while. I think prices will still go up at the end of the month when school lets out in more places, but I wouldn't be surprised if they're right about things leveling off during the summer.
Personally, I'm suspicious about the reasons behind the drop in gasoline inventory recently, but the market is certainly reflecting a relative scarcity in supply at the moment.
If you can handle the odd sports metaphor at the beginning of each one, the EIA's "This Week in Petroleum" report can make for educational reading: http://tonto.eia.doe.gov/oog/info/twip/twip.asp
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Phil L. 2:38PM (5/10/2007)
Thanks - Good link!
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66coronet 9:00PM (5/10/2007)
I see $3.44+ for regular Everett area.
Deisel is $3.18
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