Hope springs eternal for motorists with West Coast spot market pipeline diesel and gasoline prices down 3 cents per gallon on Friday. But this is just an adjustment of the big upward momentum in prices of the last two days for these two products with diesel up 7 cents and gasoline up 16 cents per gallon.
Federal Reserve Chairman Ben Bernanke, Secretaries Paulson, Geithner and President Obama are finally all singing from the same song sheet. They are now defending the new rescue plan for banks and it does seem that investors are now feeling assured that US banks will not be allowed to fail in the manner that Lehman's did back in September.
Equities markets and the petroleum markets have been taking cues from each other for the last six months in their ups and downs but mostly downs. But what that has to do with the price of potatoes. . . ., or should I say gasoline, is absolutely nothing!
Crude oil and gasoline prices have lately been moving as if they are in their own universe. Crude oil went back down under $43 a barrel on Friday as rumors being spread around in the market, about more OPEC production cuts, were being absorbed in the markets.
The spot market gasoline prices bumped back up this week after seeing major weakness last week. A myriad of confirmed refinery problems in the U.S. along with at least one confirmed permanent closure of the Big West refinery in Bakersfield has tightened supply of this precious commodity. Along with that are the full blown annual spring turn-a-rounds with refineries turning to starting to produce summer gasoline.
This will cause gasoline prices to stop going down and firm up some more in the next few weeks. Better fill your family buggy this weekend because gasoline prices will be going back up 2-5 cents per gallon by the end of next week. You may want hum the parody to the theme music of Mel Brooks' "The Producers" while you are driving to your neighborhorhood gas station today.
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