I see gold took quite a tumble yesterday [Thursday); didn't know why; then saw articles today [Friday] about Fed wanting to end "QE" by the end of this year. Regardless of the reason for gold falling in price, I would have expected oil to have followed. Before the market open, I saw that oil had fallen $1.10 according to the TV crawler, but on Yahoo, now, it's only down about 25 cents. I don't know if Yahoo and CNBC track "the same oil" quotes. Be that as it may, it appears that the price of oil is holding, despite a) fall in gold; b) slow driving season; c) lousy jobs report. For oil investors, that all seems bullish.Now today, in USA Today:
That early winter break you've been getting at the gasoline pump? It's beginning to show signs of cracking.
Gasoline prices remain below $3 a gallon in at least 50% or more outlets in 14 states. But the national average has crept up three cents to $3.30 a gallon the past week and 8 cents since hitting a 2012 low of $3.22 in mid-December.
It's likely to get worse in the coming weeks. Crude oil prices are up about $10 a gallon the past month (sic), with benchmark West Texas Intermediate crude closing at $93.09 a barrel Friday, finishing the week up 2.5%.On Friday, writing about the price of gold tumbling, I expected oil to follow suit; I was surprised it did not, as noted above. USA Today blames it on limited refinery capacity. Possibly, but that explanation certainly seems weak. I think RBN Energy has provided nice hints why we are seeing this rise in the price of oil despite decreased demand.
By the way, note the phrase in bold from USA Today: Crude oil prices are up about $10 a gallon the past month (sic), ... if crude oil prices are up about $10/gallon, that would be about $420/barrel, considering there are 42 gallons in a barrel. But I digress. I assume it's a typographical unless there is some conversion factor I am missing. (I won't recheck the story; if they correct it, readers might let me know.)
When WTI was $ 90 odd $$ earlier in the Summer Gas in Bowman Nd was $3.70 .. Today with a compareable WTI price gas i $ 3.03.. So much for the price of gas to be based on the price of OIL..
ReplyDeleteI have not seen any price increase in the Boston suburb of Belmont. The price dropped fairly quickly from $3.89 to $3.49 prior to the election, and it remains at $3.49 tonight (across the street from where our daughter/son-in-law live). I keep expecting it to go up. I am surprised it hasn't.
DeleteLos Angeles suburb San Pedro was about $3.79 if I remember. Northern California had the refinery problem and I didn't see issues in southern California. That's why I'm not convinced USA Today is correct about the refinery "thing."
Also, I'm not sure why USA Today suggests the price of gasoline will level off in April -- just when the driving season starts. And, the President says the American economy will do great this year if the debt ceiling is raised without fanfare. Smile. If the economy improves, demand for gasoline will increase. They're not selling that many Volts and Leafs.
Oh our great leader says the economy will do great this year, just increase the debt ceiling. Such wisdom and brilliance from the great one should I be impressed? NOT
ReplyDeleteFor someone who despises the free markets that are apart from him I don't believe a word he says. Like the oil and gas revelation if the economy improves it will be in spite of this President not because of him. If anything the recovery will be hampered because of him.
He will take credit for any improvement because he is so impressed with himself. Certainty he won't give credit to the American people he will think it all happened due to him and we should stand in awe of him. UGH
I remain optimistic that 2013 will be a good year, but data certainly suggests a recession. Particularly the jobs data.
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