Energy Department predicting summer gas prices to hit high of just $2.30/gallon
We've heard it a million times: What's good for GM is good for America. Well, if low gas prices are good for America (and that is a debatable point), then Charles Wilson's saying does not work the other way around. The U.S. Energy Information Administration is predicting that gasoline prices will hover around $2.23-$2.42 between now and the end of 2010, with a summer high of just $2.30 this year. Why does GM care about this? Because they need higher prices to make the Chevy Volt appealing. GM has already said that the Volt's price tag will be connected to the price of gas when the plug-in car goes on sale at the end of 2010. Before he was booted, Rick Wagoner said that $4 gallons were not the worst idea.
Why does the EIA think that $3 gasoline isn't on the horizon any time soon? Because of low demand and low global crude prices. The weak economy and surplus oil production capacity don't help one bit, either. Diesel fans could feel like winners, though: the EIA thinks that diesel prices might soon drop below gasoline for the first time in two years.
Gallery: 2011 Chevy Volt
[Source: USA Today]
Photo by Dhomonique Ricks. Licensed under Creative Commons license 2.0.
Reader Comments (Page 1 of 1)
jharlan 2:16PM (4/15/2009)
It's already $3.69 in the people's republic of Eureka, California.
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Richard in FLA 2:27PM (4/15/2009)
Even though consumption is down, it's still up in other countries. Until gasoline is as expensive as it was last year, efficient cars will not be attractive to buyers. It's empirical data.
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polo 2:54PM (4/15/2009)
Do us a favor and research before posting your next brain fart. Efficient cars are still selling better compared to other models, and most people still believe gas prices will rise. Apparently it really isn't a wise economical decision to buy a guzzler just because prices are lower now...and you know they'll jump within the next year.
Richard in FLA 3:08PM (4/15/2009)
Did you say "everyone believes"? Who's "everyone"? Good "Brain fart" tactic! Spare your insults for someone who cares. My comments are empirical, yours are emotional.
The Prius is selling less than last year where it couldn't be kept in dealers' showrooms. And that's because gasoline is inexpensive. Gas guzzling SUV sales are up, not like last decade, but higher than last year. That's because gasoline is inexpensive. The Volt, or any EV, has little chance of being a major force in the market place, as Rick Wagner has been noted as saying, unless gasoline becomes expensive again. People see the price of gasoline and purchase a car based on the running expense of that vehicle. If it doesn't cost much, they buy the most amount of car they can afford. If it costs a lot to run, they buy a less amount of car. Try proving me wrong.
paulwesterberg 4:45PM (4/15/2009)
Prius sales might be a little low right now but that is the 2010 model is due to be released soon. 3-4 months from now I bet you will still have a hard time buying one because they wont have the capacity to keep up with the demand for a 50mpg car.
Tohe 8:02PM (4/15/2009)
It is naive to think Gas prices wont rise like in the past yet again. What do people think Chavez was doing in Qatar last week? playing dominoes? Nah he does that in Cuba. There is already a stigma attached to gas, many people feel like it is a trap. You would avoid falling into a hole regardless of how deep it is, right? I think most of us share that instinct.
Matt 2:31PM (4/15/2009)
Bring it.
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polo 2:53PM (4/15/2009)
Seems like this report is more intended to manipulate the oil futures market than be any kind of reasonable estimation. Gas prices have jumped 30cents in the past 3 months....at a time when unemployment figures are at an all-time high. Any kind of improvement in the economy (which is to be expected) will raise gas by at least $1 by the summer. This report is also meaningless for making any kind of correlation to the Volt. Its coming out in 2012, not summer of '09.
Wagoner was a buffoon who should have been fired long ago. Apparently he forgot $4 gas is what got GM into the situation its in now. 10,000 Volts, even if they're highly profitable, will not save GM if consumer demand crashes like it did last time gas hit $4. I thought it was established that our economy cannot sustain itself at those kind of energy prices.
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Woodenbee 3:07PM (4/15/2009)
Actually I kind of like the $4.00 a gallon idea, $2 for big oil and $2 for building our green energy infrastructure, 390 million gallons used a day lets see thats $780 million dollars a day, hey we could send every kid to college for free, pay everyone's hospital bills, build new schools, hospitals, take care of the elderly and build all the EV's and green power infrastructure we need or I guess we could do what the Republicans do and give it to Exxon
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fnc 3:49PM (4/15/2009)
I wouldn't mind seeing the end of petroleum, but just because we're not spending a billion dollars a day on oil means doesn't mean we wouldn't be spending it (or possibly more) on another form of energy. Whatever replaces "Big Oil" will still be Big and probably expensive.
Dave 6:34PM (4/15/2009)
Whatever replaces big oil will be big and expensive, but hopefully it will mean sending a lot less money to foreign countries to run our economy.
fnc 3:59PM (4/15/2009)
I give these predictions less thought than the weather forecast. Right before it crashed, there were predictions it would go 50-100 dollars higher.
GM is crazy for trying to sell the Volt on gas savings alone. Have they learned nothing from watching Toyota and to a lesser extent Tesla? They should be pushing the green and future energy security angles of this car -hard- every time they mention it. People will open their wallets to be part of something they perceive as a cause.
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Anth 4:41PM (4/15/2009)
The comparison GM has to make is that if you switch from your gas guzzling SUV to a Volt, it'll pay off in 5 years at $3/gal. Its not exactly a fair comparison, but this is the marketing portion of the Volt effort.
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Noz 4:54PM (4/15/2009)
The higher the better.
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ElectricAid.org 5:05PM (4/15/2009)
I always think these differences is fascinating.
Back here in Norway, our prices has stabilized as well and people are happy again.
But the thing is that we pay a whooping $5.5 per gallon of gas and we have our own supply =P
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brn 5:16PM (4/15/2009)
Valid from a perceptual standpoint, but very different otherwise. Most of that isn't going to big oil, it's going to your government. That money is being pumped back into services. I pay for a lot of things that you get for "free" (paid for through things like the gas tax). It all comes out in the wash.
stas peterson 9:22PM (4/20/2009)
Unfortunately the Obama green loons also want to drive up the cost of electricity from 3-5 cents a KWH to 30-50 cents a KWH for their renewable fantasies. Tack on the $600 billion a year Cap&Trade tax on the Utilities, and the price of electricity wil go up another 50 cents a KWH. So your electric car won't recharge at 75 cents per gallon of electricity but 20 times that or $14.50 to $20.00 dollars for a gallon of electricity equivalent. Way to Go Clueless!
That would kill any BEV or PHEV electric cars except the partial gasoline based hybrids that really don't do anywhear near enough, are not a substitute, and never get us off Petroleum.
Just the way for the The Clueless Ones right hand not to know what its left hand is messing up.
Obama is NOT incompetent. He DOES know how to read a teleprompter.
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Chris M 9:46PM (4/17/2009)
stas, are you making this nonsense up on your own, or are you gullible enough to believe some right-wing pundit spouting their paranoid fantasies? There is absolutely NO evidence that Obama has any plan to raise electric rates at all, let alone to such ridiculous levels.
The rates are set by local Utility commissions, not the Federal government, so Obama couldn't raise electric rates even if he wanted to - and there's no reason that he'd want to.
JLaw45 11:55PM (4/25/2009)
Actually Chris M, he has a point though it isn't made clearly enough. Obama's cap and trade plan has a goal of limiting fossil fuel usage in power plants. What it will ultimately end up doing is forcing coal and natural gas plants(and other fossil fuel based facilities that provide about 85% of our electricity) to pay for carbon credits(essentially a tax for polluting) or retrofit their activities. Obama already admitted that as a result of this plan "Electricity rates will necessarily skyrocket". This is because the energy companies will past the cost of the carbon credits and their efforts to lower their emissions on to consumers. Estimates for this cost range from $1000-2000 a year per household. It is actually quite possible that we may see $3000 overall.
Here's the quote from Obama: http://www.youtube.com/watch?v=ydqg7ThZB04
So yes, stas has a point. Obama does want to make electricity more expensive.
GoodCheer 1:41PM (6/09/2009)
Aaah, hindsight is fun isn't it?
http://www.fuelgaugereport.com/
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