After the gasoline price Mardi Gras ended last week, things have since calmed down. Gas stations slowed down after the price hike parties that were abundant across the United States and Canada last week, but more price increases are likely coming soon.
While the situation initially cooled off last week and earlier this week after the tragedy in Japan, oil markets are again heating up, in a similar fashion to the crisis at Japanese nuclear facilities, and similar to that situation, there may be little we can do to cool off this upcoming round of price increases.
While I await final calculations before alerting some of you in the Great Lakes states to possible price hikes via Speedway tomorrow, there's no doubt in my mind that a majority of the U.S. and Canada could see prices begin to rise again as soon as tomorrow and really heating up early next week.
For those who thought we were done with increases- may I remind you to make sure you're looking outside and realizing the trees are turning green and that the calendar show's we're in March. What's that mean? By now you should know that March should be referred to as the month that gasoline prices traditionally rise as summer spec material begins flowing into the markets. It's also when speculators, along with the rest of traders, begin worrying about supply being enough to meet summer demand.
Make no mistake, there's plenty of crude- but that's not we pump into our cars. The problem is that Japan suddenly needs refined petroleum, such as gasoline and diesel as a result of six refineries shut down there. That will mean there will be pressure on prices to rise as Japan seeks finished products from the West Coast. To those who don't think there's pressure on prices to rise- there sure is pressure, especially on heavier oils used for industrial equipment that will help bring Japan back to normalcy (if it can be called such). Diesel fuels will be used in generators, fuel oil in ships bound for the island nation, all of which will keep pressure on oil prices.
So enjoy the break we saw at the pump- gasoline prices are getting ready for another climb up. Let's face it- gas prices are on a roller coaster up. That roller coaster had been stuck on the climb up, but once it moves up, it keeps moving up until it peaks- and it hasn't peaked just yet.