What Will Gas Prices Finally Do?
Posted: under Gold News, Oil News.
Whether or not the gas bubble has burst, Americans are now living in an economy where the prospect of a gallon of gas for less than $4 is cause for celebration.
That barrier could be broken as early as this coming weekend, as a two-week header in crude prices has begun to ripple out to all gas stations nationwide.
The national average for a gallon of regular gas has pulled back to just above $4 a gallon and oil is tumbling to its lowest point in weeks just recently. The belief that high prices have yet to reflect just how badly the demand has dropped in the United States, one of the world’s thirstiest oil consumers.
Pump prices are poised to dip even further, and very well may cost as much as 25 cents less by Labor Day. People do say typically, prices will shoot up like a rocket, and fall like a feather. However, this time, it is looking like it is different. The retail sector especially is interested in bringing down these prices as fast as they can so the retail business can be stimulated in their convenience stores.
In the oil news markets, oil has continued on a two-week sell off. Light, sweet crude for September’s delivery has fallen to $2.23 to settle at $123.26 a barrel in the New York Mercantile Exchange. Earlier the contract dropped even more to $122.50, its lowest point since June of this year.
In the oil news, many analysts say the market’s momentum is pointing to further declines. Crude prices have dropped in seven of the last nine sessions, and are currently down more than 16 percent from its highest price above $147 a barrel just earlier this month.
There is nothing sufficiently bullish coming into the market at this time to sustain a rally. We are just seeing a new theme where as demand has become a very significant part of the equation. Oil news does tell us prices have remained about 65% her than they were at this time last year.
Signs of Americans continued struggle with soaring energy prices are affecting the filling station operators that are hungry for business to ratchet down the average price for a gallon of regular gas by 2 cents to encourage purchases.
Such a large decline suggests demands are fading. Retail prices have fallen about a $.10 cents per gallon in just the past week. We are seeing a drastic and historic change in the Americans driving habits; however, we still have a long ways to go before we reach the comfort zone again.
The talk on the trading floors has all the sudden shifted to demand worries and analysts note that prices could rebound even if just on a temporary cut to supply. The abduction of five crew members recently from a Swedish boat in
Region has been a reminder that much of the world’s oil is still being pulled from politically volatile regions. The African nation is a huge supplier to the
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Aug 22 2008