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January 20, 2012

Spring Is Coming

 

And so apparently is $4 gas. Fred Rozell of OPIS sees $4-$4.25 gas sometime between April and early May. Patrick DeHaan of gasbuddy.com predicts $3.75 to $4.15 by May.

Look out Chicago! DeHaan predicts $4.60-$4.95/gal. LA: mid-to-upper $4.00.

“Bigger cities will always have higher prices due to higher gas taxes and the cost of doing business,” DeHaan said.

Could be worse.

Despite the possibility of record high gas prices this spring, Rozell says things could be worse. “Over the last 10 years, we have tended to see a 75% increase in prices from the winter low to the spring peak. This year, we are only forecasting about a 40% rise because of bearish economic news.”

Filed under:Fuel cost,Fuel Price Trends,Gas price | by Pump Girl @ 10:47 am | 

January 5, 2012

Gas Prices in 2012?

 

Oh dear, things don’t look so pleasant. Gas prices in Texas are already up six cents a gallon to $3.12. They only paid $2.90 or so last year.

Here are some forecasts for the coming year:

Head of commodities research at Citigroup Global Markets Inc. says gas may rise over $4 next summer

Tom Kloza at OPIS says prices could rise a high as $3.75-$4.50.

The federal EIA is a little more optimistic, predicting more like $3.45.

Filed under:Fuel cost,Gas price | by Pump Girl @ 8:17 pm | 

EU Reaches Agreement on New Iran Sanctions

 

Oil prices rose today on the news that European diplomats had reached a preliminary agreement to issue new economic sanctions on Iran. Progress on sanctions had been held up by the envoys from Greece, who have now dropped their objections. While debate on the specifics of the sanctions is ongoing, all countries in the EU are resolved to proceed.

Two weeks ago, debate over these new sanctions on Iranian oil prompted to government in Tehran to threaten to close the Strait of Hormuz. The threat was promptly backed up by a 10-day series of war games and the tests of some new weapons system.

The Iranian government has yet to respond to this latest news, but this move by the EU is sure to increase tension even further.

Filed under:Fuel Cost Control,Gas price,Price Shocks | by Guy in a Suit @ 4:39 pm | 

January 3, 2012

Fresh Threats from Iran

 

After the US Navy removed an air craft carrier from the Persian Gulf, the Iranian military warned Washington not to redeploy it to the area. This news comes in the midst ongoing war games in the Strait of Hormuz, accompanied by tests of new land-to-water cruise missiles.

Despite this, the US military remains unfazed. An official statement from the Pentagon today stated: “These are regularly scheduled movements in accordance with our longstanding commitments to the security and stability of the region and in support of ongoing operations.”

The escalating tensions in Iran have led directly to higher oil prices in the past several days. The Financial Times notes that “the latest comments from Tehran sent Brent crude, the global benchmark, 3.5 per cent higher to $111.35 for the first time in three weeks.”

Again, to stress the importance of the Strait of Hormuz:

The Strait of Hormuz is a narrow channel which is the conduit for 17m barrels a day of oil. The US Department of Energy describes the strait as “the world’s most important oil chokepoint”, with an average of 14 supertankers passing through it every day, most of them heading towards Japan, South Korea, India and China.

Analysts believe that Iran would not be able to shut it down completely. But even a brief closure of the strait would have a dramatic impact on oil prices, traders believe, predicting a rise towards $150 a barrel – or beyond, if the disruption is prolonged.

Filed under:Fuel cost,Gas price,Price Shocks | by Guy in a Suit @ 2:25 pm |