As the MSM attempts to work the masses into a stock buying frenzy, even though 90% of the population owns virtually no stocks, another record is being set. Gas prices will reach the highest level in U.S. history for the month of February. So, for that median family making $50,000 per year their weekly budget will be taking another hit. We know that real wages actually declined in 2012. This family also just got nailed with a $1,000 tax increase on January 1. We know that Obamacare is already increasing healthcare premiums by 10% or more. We know there are 250,000 less people employed today than there were in September.
I think your only choice is to take out a loan on your credit card and put it all into Facebook stock. Either that, or invest in a gasoline or oil ETF. The stock market gains YTD look puny next to the double digit gains in oil, gas and ethanol. This is great news for the economy. Right?
I’m sure glad this won’t have an impact on food prices or anything else that has to be transported. Bennie tells me inflation is well contained.
Gasoline prices rising, getting an early start on spring surge
National, international factors bring spring surge earlier than usual
Gasoline prices are getting an early start on their annual spring march higher.
The average U.S. retail price rose 13 cents over the past two weeks to $3.42 per gallon, and within a few days it likely will set a record for this time of year.
Regular unleaded self-serve gasoline in the Richmond region rose 10 cents in the past week — including jumping 4 cents Friday from the day before, according to AAA Mid-Atlantic. The region’s average price Friday stood at $3.30 per gallon.
“The double-digit weekly spike, combined with various national and international factors, leads AAA analysts to believe the national gas price average could rise to $3.50 per gallon in February,” said Windy VanCuren with AAA Mid-Atlantic in Richmond.
The culprits: rising crude oil prices, slowing output at refineries that are undergoing maintenance and low supplies of gasoline.
These are the kinds of factors that push gas prices higher every spring after what is normally a lull in the late fall and early winter. But a heavy schedule of January maintenance at West Coast refineries has led to sharply higher prices there. Meanwhile, low inventories have pushed prices higher on the East Coast.
And rising crude prices have pushed the cost of gas higher throughout the country.
“I’m not surprised at what I’m seeing, but I am surprised it’s coming early,” said Tom Kloza, chief oil analyst at the Oil Price Information Service.
Hopes of stronger economic growth in the U.S. and abroad helped push the U.S. stock market to a five-year high in January and sent crude prices up. When economies expand, more gasoline, diesel and jet fuel are consumed by shippers and travelers.
“We may end up seeing less fuel consumption,” Virginia Transportation Secretary Sean Connaughton said. “That has the potential to further deteriorate the state’s transportation funding situation,” which depends heavily on the tax on gas sales.
Crude oil has risen 14 percent since mid-December, to $97.49 on Thursday. Brent crude, the benchmark used to price oil that most U.S. refineries use to make gasoline, is up 9 percent since then to $115.55
But gasoline wholesale prices are rising even faster. That’s the price distributors and service stations pay to buy the gasoline that they then sell to drivers.
U.S. retail gas prices have risen for 14 days straight, according to AAA. The average price for the month of January was $3.32, the second-highest January average ever, although a nickel cheaper than last year’s record.
In each of the past two years, gas prices rose sharply at the beginning of the year because tensions in the Middle East raised fears that oil supplies would be disrupted. In 2011, it was the Libyan uprising; in 2012, it was Iran’s threat to close a key shipping lane.
“Gas prices did not reflect for a long time that oil was going up for the last almost two months,” said George E. Hoffer, a transportation economist at the University of Richmond.
“Gas prices lagged oil prices,” he said. “Now they have caught up with a vengeance, reflecting the crude oil price increases.”
So far in 2013, gas has been cheaper than it was last year. But that could change by this weekend as stations pass along the cost of their higher-priced gasoline to drivers.
“We’re looking at price increases going on,” said Michael J. O’Connor, president and CEO of the Virginia Petroleum, Convenience and Grocery Association. “Last year, we didn’t see much of a break till April.”
Staff writer Peter Bacqué and The Associated Press contributed to this report.