Global| Oct 23 2012U.S. Gasoline Prices Decline Sharply With Slackened Demand
by:Tom Moeller
|in:Economy in Brief
Summary
The summer driving season is over and the overall economy is weak. That's a prescription for lower gasoline prices. Last week, the pump price for a gallon of regular gasoline dropped thirteen cents (-3.5%) to $3.69 per gallon. That [...]
The summer driving season is over and the overall economy is weak. That's a prescription for lower gasoline prices. Last week, the pump price for a gallon of regular gasoline dropped thirteen cents (-3.5%) to $3.69 per gallon. That was the largest w/w drop since the last recession. Haver Analytics constructs seasonal factors to account for usual volatility and the adjusted price fell eleven cents w/w to $3.75 per gallon.
Improved mileage standards for passenger cars and the lackluster economy lowered the demand for gasoline 2.3% y/y. The demand for other petroleum products also weakened. Residual fuel oil needs, used for heating, fell 28.6% y/y and distillate demand dropped 4.2% y/y. Lending some support to prices was a 4.4% y/y decline in gasoline inventories.
The price for a barrel of light sweet crude oil ticked up last week to $91.64 per barrel. However, yesterday, the cost of crude reversed that gain and fell sharply to $88.73 per barrel, nearly the lowest level since early August. Prices peaked at $113.93 in April, 2011. Haver's seasonally adjusted crude oil price per barrel inched up last week to $90.74. Brent crude oil prices fell last week to $113.61 per barrel.
Natural gas prices rose last week to $3.31 per mmbtu, an eleven month high.
The energy price data are reported by the U.S. Department of Energy and can be found in Haver's WEEKLY database. The daily figures are in DAILY and the gasoline demand figures are in OILWKLY.
| Weekly Price | 10/22/12 | 10/15/12 | 10/08/12 | Y/Y% | 2011 | 2010 | 2009 |
|---|---|---|---|---|---|---|---|
| Retail Regular Gasoline ($ per Gallon, Regular) | 3.69 | 3.82 | 3.85 | 6.5 | 3.52 | 2.78 | 2.35 |
| Light Sweet Crude Oil, WTI ($ per bbl.) | 91.64 | 91.38 | 90.82 | 5.7 | 95.14 | 79.51 | 61.39 |
| Natural Gas ($/mmbtu) | 3.31 | 3.26 | 3.21 | -8.3 | 3.99 | 4.40 | 3.95 |
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.
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