Posted in: Gas Prices,
by Patrick DeHaan on Sep 7, 2011 10:13 AM
With summer driving season officially over, we lose some (note- some, but not all) pressure on gasoline prices. However, we're still contending with a somewhat active hurricane season. Just taking a quick peek at the National Hurricane Center website, I see three active storms. While none are threatening oil infrastructure right now, this remains on the mind of your average Joe trader.
Gasoline price averages stand at $3.66 today in the U.S. and 126.5c/L in Canada, having moved up slightly in the last week, likely thanks to Irene-related shutdowns as well as Lee-related shutdowns in the Gulf. I'm starting to wonder if oil companies are beginning to use such storms to evacuate their facilities and keep pressure on prices. (It's a good excuse to evacuate your rig, right? Impending storm? Sure thing.)
By next Monday I expect that gasoline prices will have stayed relatively flat compared to where they sit today. I forecast that the U.S. average will rise/fall 1-2 cents and the Canadian average will rise/fall 0-1c/L. It's hard to forecast in what direction they'll move because of volatility on the market. Tuesday, we saw a large early morning drop in futures, but later in the day, futures bounced back. We've seen these wild swings many times in the last few months, and its making forecasting gas price changes rather difficult.
Good news for motorists also comes September 15 when the EPA allows winter gasoline to again be sold at retailers. Winter gasoline emits more air pollution, but in the cooler months, it's not as much as a concern. Winter gasoline contains more butane, which is relatively cheap, and burns easy. You may notice a slight drop in MPG in the next few weeks as winter gasoline begins to be sold again at retailers.