Global| Aug 18 2009Gasoline Price Increase Stabilizes After A One Dollar Rise This Year
by:Tom Moeller
|in:Economy in Brief
Summary
The strong rise this year in gasoline prices stabilized last week. The pump price for regular gasoline held at an average $2.64 per gallon and that was down a nickel from last month's high. Despite this w/w stability, however, prices [...]
The strong rise this year in gasoline prices stabilized last week. The pump price for regular gasoline held at an average $2.64 per gallon and that was down a nickel from last month's high. Despite this w/w stability, however, prices remain roughly one dollar (59%) higher versus the December low. Yesterday, the cash market price for gasoline of $1.87 was down from last week and down from the $1.99 averaged the week earlier. Nevertheless, gasoline prices were up off the early-July low of $1.60. The figures are reported by the U.S. Department of Energy and can be found in Haver's WEEKLY & DAILY databases.
Crude oil prices also are slightly off their high. Light sweet crude oil prices (WTI) dipped last week to $69.65 per barrel but they've roughly doubled this year. Yesterday the spot market price for light sweet crude oil fell back again, to $66.75 per barrel. Prices had reached a daily high of $72.68 earlier in July.
Of late, the demand for gasoline hit a plateau after an earlier seasonal run-up. During the last four weeks since May, the demand for gasoline has moved sideways and is down by 3.1% y/y. Though that compares to a nearly 5% rate of decline last fall, the relative strength is diminishing. Demand for distillate also is off a sharp 20.7% though residual fuel oil demand has moved higher. Finally, oil remains plentiful as evidenced by a 14.1% y/y rise in inventories of crude oil & petroleum products. Inventories of gasoline recently have firmed by 4.5% y/y and crude oil inventories less the SPR are up by 18.7%. The figures on crude oil production and inventories are available in Haver's OILWKLY database.
Natural gas prices continued their move sideways last week. At an average of $3.44 per mmbtu (-62.8% y/y), the price was down by three-quarters from the high reached in early-July of last year of $13.19/mmbtu.
| Weekly Prices | 08/17/09 | 08/10/09 | Y/Y | 2008 | 2007 | 2006 |
|---|---|---|---|---|---|---|
| Retail Regular Gasoline ($ per Gallon, Regular) | 2.64 | 2.65 | -29.5% | 3.25 | 2.80 | 2.57 |
| Light Sweet Crude Oil, WTI ($ per bbl.) | 69.65 | 71.57 | -39.1% | 100.16 | 72.25 | 66.12 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
