Saturday, January 17, 2009

Gasoline price spike resumes, but may stabilize soon

The price of gasoline has resumed its recent spike higher, with the AAA Daily Fuel Gauge Report showing that the national average retail price for a gallon of regular unleaded gasoline has risen from its recent peak of $1.792 to a new peak of $1.831.

Wholesale gasoline futures have risen lately, with February RBOB unleaded gasoline futures at $1.1672, indicating that retail prices are headed for $1.76 to $1.81 within a few weeks, about 5 cents below the current price level.

Still, this latest move of the past week is likely to be simply gasoline trading in a range rather than a major new trend. The price of crude had spiked upwards recently, but lately has given back a big chunk of those gains.

Gasoline below $2 continues to mean more cash in the pockets of consumers and less pressure on their budgets as well as the budgets of businesses and governmental entities. It also means more traffic on the roads.

-- Jack Krupansky

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