Average pump prices in California hit a record $4.614/gallon yesterday vs. $4.145 a week earlier following refinery and pipeline outages, with one downtown LA station even selling regular grade at $5.49/gallon. Prices might now have peaked, as Exxon's Torrance refinery resumed normal ops on Friday after experiencing power problems.
Tropical Storm Isaac is upgraded to Category 1 hurricane by the NHS, with sustained winds of 75 mph and moving northwest at 10 mph. Natural gas (UNG) and gasoline (UGA) futures remain flat to moderately lower. WTI crude (USO) +0.5%.
It seems like we can have higher stock prices or lower crude oil prices, but we can't have both. Crude continues a 6-week rally, moving to its highest price since spring at $94.24. The gasoline ETF: UGA +14.9% in the last month. Earlier, inventory data showed an unexpected draw on stocks.
Crude futures tumble 2.3% to $82.86. Natural gas (-0.9%) and gasoline (-1.3%) aren't looking too hot either. Disappointment from lack of Fed easing hints? Concerns over upcoming China data? Or just a general bearish sell-off?
"We caution against mistakenly categorizing speculation as a form of manipulation," says the CME, responding to the President's proposals this morning. "To use margin requirements to control cash prices is misplaced ... (this) would make the markets less efficient, less tied to fundamentals ... push hedgers out of the market ... (and) make oil more expensive for all consumers."
The President's plan to chill supposed oil manipulation: Increase by 6-fold the surveillance and enforcement staff at the CFTC. Increase spending on surveillance technology. Increase civil and criminal penalties for manipulation from $1M to $10M. Give the CFTC authority to increase margins (presumably now only the domain of the exchanges). Crude +1.4% to $104.84.
With gasoline hovering around $4/gallon, the President this morning is expected to announce proposals to crack down on higher oil prices, including increased penalties for market manipulation and allowing for an increase in margin requirements. Wouldn't phone calls to the FOMC, BoE, and the ECB be easier? WTI crude +0.8% to $104.22.
Though gas prices on average have tricked lower over the last week, drivers on the East Coast aren't paying less at the pump. A flurry of refinery closures in the region have pushed up transport costs in a trend that could continue through the summer.
Gas prices are set to rise, according to EIA forecasts. Retail gasoline prices are expected to average $3.81 in 2012 and $3.73 per gallon in 2013, up $0.26 and $0.14 respectively from last months estimates. The energy agency adds that prices are likely to average $3.95 a gallon from April to September, with a peak called for in May at $4.01 a gallon.
Prices at the pump creep higher again, the average price for regular rising to $3.925/gallon as of early this morning. The price is nearly 11% higher Y/Y and at another new record for March. Gasoline ETF: UGA +18.9% YTD.
The average price at the pump creeps higher, rounding up to $3.90/gallon for regular, according to AAA. UGA +20.5% YTD. Beleaguered drivers can take tiny comfort from oil today, not participating in the Bernanke-led stock and commodity rally. WTI crude flat at $106.84.
Although there has been much debate about the economic and political effects of rising gasoline costs, studies indicate that while consumers get angry, the issue doesn't have a particularly big influence on whom they'll vote for. A major reason is that there is division as to whether politicians are even responsible.
While inflation came in below expectations in February, gasoline prices jumped 6% and futures indicate that $4/gallon is not far off, with the average pump price $3.831 on Friday. A major reason is that loss-making North East refineries are being idled or shut permanently as their operators get squeezed by higher oil prices.