Gasoline back under $2.80 and cheaper than a year ago!!!

We have hit a major milestone in the fight against commodities inflation with gasoline now selling for less than a full year ago. The AAA Daily Fuel Gauge Report shows that the average price of a gallon of regular unleaded gasoline was $2.781 yesterday compared to $2.820 one year ago.

While everybody bounces between agony and ecstasy over the (seemingly) excruciatingly slow process of the big bank bailout, meanwhile consumers are (silently) reaping the benefits of the crude oil and wholesale gasoline "bailout" of speculators -- "bailout" as in the speculators are bailing out of their positions and the prices of crude oil and wholesale gasoline have been falling. Crude oil is down near $63, more than 50% below its peak price of $148.60 on 7/11/2008. Retail gasoline price declines continue to ratchet downwards, with the AAA Daily Fuel Gauge Report price falling to $2.781.

November RBOB unleaded gasoline futures are at $1.4676, indicating that retail prices are headed for $2.06 to $2.11 within a few weeks, about 70 cents below the current price level.

The media is not giving these gasoline price declines much press, but all of this extra cash in the pockets of consumers will help to buoy consumer sentiment and domestic spending as well as boosting GDP by reducing the subtraction due to imports of crude oil. Businesses and government will benefit from the steep price declines as well.

-- Jack Krupansky