Posted in: Gas Prices,
by Patrick DeHaan on Feb 23, 2010 02:12 PM
U.S. average prices for a gallon of regular unleaded are poised to climb back to January highs this week as supply and demand issues are ignored and geopolitical issues come to light.
U.S. gasoline prices bottomed out February 16 at $2.612, but have since moved higher, to $2.689 at this writing. Gasoline prices will come close to hitting their 2010 highs in the next week as traditional fundamentals showing weak demand and adequate supply are seemingly ignored, with traders focusing more on French refinery strikes and Iran's nuclear ambitions.
Also helping push prices higher in some areas is the return of Spring gasoline, produced in some areas as temperatures warm. While this gasoline is less volatile, it is also more expensive. (I might use a future blog entry to examine cost differences between seasons.)
While retail prices will climb, wholesale prices may begin a gentle fall as indications show the recent rally to $80 oil has run out of steam. Retail prices will continue to rise against cheaper crude because retail prices many times trail oil prices higher. Looking at today's numbers, I think this rally will see U.S. averages easily in the $2.70's by this weekend, and very close to 2010 highs by Wednesday next week before prices gently decline.
Some areas of the country continue to buck the trend higher- such as Wyoming. Cities in Wyoming still feature gasoline under $2.30! Many times, the reason is that the population is smaller, and due to low demand, gas stations haven't had the need to purchase new deliveries of more expensive gasoline, keeping their prices low.
Enjoy it while it lasts, Wyoming- prices may begin to slowly head higher... even there... soon.