A strong U.S. dollar is certainly helping push oil prices back towards the $69 level today, as well as a concern about jobs (or lack thereof).
The jobless report that came in today was quite a surprise, showing that the number of Americans filing new claims for unemployment unexpectedly rose to 480,000 last week, 15,000 more than economists had expected. (READ MORE!)
While the four week average for new jobless claims has dropped to its lowest level since late-Summer 2008, there are fresh concerns about the speed of economic recovery and the hiring of new workers. The concerns about the jobless rate coupled with a strong dollar today have sent oil prices down closer to $70.
The U.S. dollar is showing its best performance since October, fetching 0.6975 euros per dollar today. Just a few days ago, the dollar was worth 0.66 euros. A stronger U.S. dollar makes oil cheaper for the United States while making it more expensive for other areas, such as Europe and Asia.
Wholesale gasoline prices are also trading lower for the same reasons. However, there have been some small concerns as of late that may prevent gasoline from falling much more. Can you guess? Something to do with... a refinery... or two. A refinery in Alberta that refines tar sands into oil had to shut down a unit that produces nearly 200,000 barrels per day for a few weeks, while refineries in California prepare to undergo maintenance in the next few weeks.
Besides isolated rising prices in those areas, the rest of the country will stay quite stable the next week, as has been the case since early November.
However, with Christmas travel right around the corner, we'll likely see stations temporarily raise prices, eager to take advantage of holiday travelers. Remember to fuel up early next week to prevent paying a "holiday surcharge".
Update! Those who live in the "Speedway States" already got your early Christmas "present"... a hike to $2.55-$2.65, depending on where you live. $2.55 in Michigan, $2.55 in Indiana, $2.59 in Ohio!