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Economy in Brief

U.S. Petroleum & Other Commodity Prices Move Higher
by Tom Moeller March 2, 2010

A modest uptick in the pump price for regular gasoline last week to $2.70 took it to the highest level since January. This continued a trend of rising prices since early-2009, which followed a recession-related downturn. Yesterday, the spot market price for a gallon of regular gasoline retraced some of that increase with a 3 cent decline. The figures are reported by the U.S. Department of Energy and can be found in Haver's WEEKLY & DAILY databases.

The price for a barrel of light sweet crude (WTI) fell last week to $79.26 and left it down from the early-January high of $82.59. However, crude oil prices have fueled the same rising trend for gasoline. Prices have risen from $71.53 early this past December and are more than double the December 2008 low of $32.37. Yesterday, the spot price fell moderately to $78.70.

Demand for gasoline fell 2.7% last week versus one year ago. That decline compared to a 3.9% increase at the beginning of October. The demand for residual fuel oil fell 3.5% y/y though the decline has eased from -40.4% in February. Distillate demand fell 11.3% y/y, a decline more moderate than the 21.6% y/y shortfall at the beginning of last July. Inventories of crude oil and petroleum products slipped in February but were up 1.1% from one year ago.

U.S. natural gas prices fell last week to an average $4.88 per mmbtu (+17.3% y/y) from the high of $6.50 early in January. Nevertheless they remained double the September low.

The energy price data can be found in Haver's WEEKLY database while the daily figures are in DAILY. The gasoline demand figures are in OILWKLY.

Outside of energy, commodity prices also have been strong. Copper has led the gain as scrap prices have more-than doubled since early last year. Scrap steel prices also have doubled during the same period. Not far behind in the metals area are aluminum prices, up by two-thirds. With improved housing activity has come strength in lumber prices which have risen more than 50% since early-2009. Cotton prices also have nearly doubled with improvement in consumer spending. In the agricultural area, foodstuffs including wheat, corn & butter, as well as livestock prices have risen by one-half. Finally, gold prices near $1,100 pounce have risen 50% since the fall of '08 and have roughly tripled since 2001.

Weekly Prices 03/01/10 02/22/10 02/15/10 Y/Y 2009 2008 2007
Retail Regular Gasoline ($ per Gallon, Regular) 2.70 2.66 2.61 39.7% 2.35 3.25 2.80
Light Sweet Crude Oil, WTI  ($ per bbl.) 79.26 78.30 73.91 89.6% 61.39 100.16 72.25
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