Gasoline At The Pump Headed To $1.50 Gal.

Gasoline At The Pump Headed To $1.50 Gal.

$UGA, $USO

Not since Y 2009 has the national average price for a gallon of regular gasoline dropped below the 2.00 mark.

The prediction being made this week by AAA states that due to factors including a “Bearish sentiment” on global petroleum prices and normal early Winter declines in demand for Gasoline, “Gasoline pump prices are expected to move lower to close out the year, barring any unanticipated outages or supply disruptions.”

This means that the national average for gasoline, at 2.16 gal as Monday, down 7¢ in the past week, will soon fall below 2.00 gal, most likely by Christmas. The national average has not been this low since the onset of the Great Recession.

The observers at the gas price-tracking site GasBuddy thinks that AAA is actually playing it conservative in terms of forecasting how quick, and how deep prices will decline in the coming weeks. Not long ago, GasBuddy predicted the national average would hit 1.98 by Christmas.

Now the site’s analysts see even steeper drops by 25 December.

Some of the cheapest stations in the nation could drop to 1.49 gallon by then, with the national average dropping into the 1.80’s. It’s even possible that by Thanksgiving we could see a sub 2.00 gal national average.

It’s worth noting that gasoline prices right now are exceptionally cheap compared to last year, with a national average of nearly 75¢ less per gallon. And all signs indicate that prices will remain cheap next year.

“Global supply continues to outpace demand, while a strengthening USD, which makes Crude Oil more expensive for buyers holding foreign currencies, is expected to keep a ceiling on prices into Y 2016,” this week’s AAA report states.

Stay tuned…

HeffX-LTN

Paul Ebeling

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