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There's good news, bad news
Incremental rises flatten, but prices here still creep higher
The good news: Gasoline prices advanced last week by the smallest weekly increment since the beginning of May. According to 'Retail Fuel Watch,' a trade publication reporting on retail gasoline and diesel prices and profits, the rate at which prices are rising has slowed, and 'spot' prices, which drive wholesale and retail prices, have stopped advancing for the time being. "There's a paradox that lies ahead," said Gregg Laskoski, managing director of public relations for AAA Auto Club South. "The good news for consumers is that gasoline futures have started to decline because the Department of Energy reported a surplus of fuel and overall demand remains weak. But, as we saw last summer, the price at the pump doesn't always reflect supply-and-demand fundamentals." Investors continue to use commodities and crude oil as a hedge against a weak dollar, and they are betting that the economy will improve and global supplies will start to shrink. "While we might see prices plateau in coming weeks, nobody can accurately predict when the value of the U.S. dollar will increase or decrease; but we do know that when it decreases, crude oil and gasoline prices usually go up no matter how favorable the supply and-demand figures might seem," Laskoski added. On the New York Mercantile Exchange (NYMEX), crude oil closed last Friday at $69.55 a barrel, down $2.49 from the previous week's closing price of $72.04 per barrel. |
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