All of a sudden we are awash in oil?
Call me skeptical-as electric cars begin to make financial sense, then all of a sudden there is plenty of oil and readily available at a low price.
Good for us Boss drivers getting all of 13 mpg.
http://online.wsj.com/articles/oil-glut-ignites-gasoline-price-swoon-1410476422?mod=WSJ_hp_LEFTWhatsNewsCollection
Oil Glut Ignites Gasoline Price Swoon
Markets Are Signaling That More Relief at Pump May Be on the Way.
By NICOLE FRIEDMAN CONNECT
Sept. 11, 2014 7:00 p.m. ET
Consumers are expected to see lower prices at the pump as gas prices fall. Associated Press
Gasoline prices have tumbled from highs hit in June. And markets are signaling that consumers will get even more relief at the pump.
A global glut of crude oil is the main driver behind the decline in gasoline. Relatively cheap oil has made it more profitable for refiners to produce gasoline and other fuels, and they have ramped up production to record levels.
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This boom in supplies has sent gasoline prices tumbling. Traders and other market observers expect the flow of both crude oil and gasoline to keep rising, likely exerting more downward pressure on prices.
The average retail price for a gallon of regular gasoline was $3.42 on Thursday, down 3.8% from the same period in 2013, according to motor club AAA. For this time of year, gasoline prices are at their lowest level in four years.
"We certainly have plenty of crude-oil supply over the next couple of months and plenty of products," said Andy Lipow, president of consulting firm Lipow Oil Associates in Houston. "I'm expecting the national average to drop to $3.15 by Halloween, and $3 a gallon as a national average is certainly in the cards." Analysts at AAA predict prices could fall another 15 to 20 cents by the end of October.
A sustained period of relatively low gasoline prices could help bolster the consumer-driven U.S. economy, which has posted wobbly growth this year. Many policy makers remain concerned about the outlook, with a disappointing August jobs report adding to jitters. By paying less at the pump, consumers could use the cash to make other purchases.
Retail gasoline prices often fall as summer vacation winds down, but the speed and size of the recent decline underscore shifts in energy markets that many analysts expect to be lasting. U.S. gasoline output climbed above 10 million barrels a day for the first time on record in late April, according to the Energy Information Administration, and held above that level in 11 of the 19 weeks since then.
Ed Quintrell, 60 years old, of Woodland, Wash., said he is less likely to impose surcharges on customers of his construction business given the decline in pump prices. Mr. Quintrell spends up to $12,000 a year fueling his Ford F-350 pickup truck. Gasoline prices are a big cost, and "I'm glad to see them lower," he said.
Trading in futures markets indicates that gasoline retail prices have further to fall. Gasoline for October delivery, the front-month contract, on Thursday slipped 0.24 cent, or 0.1%, to $2.5241 a gallon, a 10-month low. During intraday trading, prices dipped into bear-market territory, defined as a 20% drop from a recent high.
Gasoline has declined 19% from its 52-week high hit in June and is off 9.3% this month.