Recent Gas Price Hike Could Forecast the Future

January 19th, 2009 | by alexis |

Gas prices rose for the sixth consecutive day Monday, putting the national average at $1.842 a gallon. It’s a figure that’s 3 full cents higher than Friday’s figures.

Gas Comparisons Over the Last Year
Despite the temporary jump in prices, gas is still selling for 39% of what it sold for last January and 55% less than this summer when gas prices reached record national highs of $4.114 a gallon on July 17. Only Alaska, Hawaii, California and Washington currently have gas price averages above the $2.00 mark.

Oil by the Barrel
In spite of gallon gas prices that are creeping back upward, the price of oil by the barrel has remained low. Currently the price of oil according to OPEC is at $34 dollars a barrel, two dollars less than it sold for last Friday, and resolutions to various international disputes imply that the cost of an oil barrel may drop a bit more before it starts to go back up.

Still though, Jeffrey Currie, a commodities analyst at Goldman Sachs, foresees the price of a barrel will hit $65 again before the year is over. To keep things in perspective, oil was selling at $147.27 a barrel in mid-July when prices had reached such an apex.

Future Gasoline Figures
The inevitable rise in oil prices will naturally force the price of gasoline back up to a national average of more than $2.50 a gallon in the near future. It’s a prediction that’s further supported by OPEC’s eventual realization of their goal to cut current production of oil by 4.2 million barrels, taking it from 29.2 barrels a day down to 25 million barrels.

Obviously we can’t tell you to buy your year’s share of gasoline now, it’s a pretty difficult thing to store en masse, but these figures should serve as ample notice that the days of cheap, cheap gas may be on their way out. The face of gasoline is changing, and we’re set to start budgeting for the change now.

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  1. 2 Responses to “Recent Gas Price Hike Could Forecast the Future”

  2. By Albert on Jan 20, 2009 | Reply

    Nice post. It’s refreshing to see someone write about what I can do with oil/gas down at these levels. I did a few things you might want to take a look at if you think oil/gas is going back up. I am in a few ETFs, UCO for short term or USO for long term. I also hedged my personal consumption with petrofix.com and use gasbuddy.com for local prices. It seems like there are a lot of tools that we did not have in the past to deal with rising prices.

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