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sajahmeoli (65.11)

Gasoline Futures Looking Better, Worse

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May 11, 2011 – Comments (8)

It all depends on one's perspective. Seeing that I am not currently invested in these futures, but that I am a few days away from an extensive road trip, this seems like good news to me:


Oil prices tumbled 4 percent on Wednesday as U.S. gasoline futures plunged limit down, triggering a brief halt in trade on the New York Mercantile Exchange.


Gasoline traded down 25 cents at midday in New York, a move that stopped trade on NYMEX crude, heating oil and gasoline futures. Losses carried on as trading resumed with a new limit of 50 cents. Prices completed erased gains from Monday and Tuesday, when traders bid up gasoline on fears that flooding would hit Gulf refiners.

What are you thinking? Is this a blip or are we seeing the beginning of a correction in the energy markets which will drive prices down for the near term (summer and fall, perhaps)?

8 Comments – Post Your Own

#1) On May 11, 2011 at 3:02 PM, cbwang888 (25.55) wrote:

blip ...

If China is determined to gradually unload $2T of US bonds, what will they buy?

 

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#2) On May 11, 2011 at 4:27 PM, goldminingXpert (29.64) wrote:

gas is going back to $2/gallon ... we are replaying summer 2008 now.

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#3) On May 11, 2011 at 4:52 PM, sajahmeoli (65.11) wrote:

cbwang888,

I suppose that China could buy quite a bit to offset the bonds, but I'm not sure that their own currency is stable. That said, crude is definitely the top global commodity.

goldminingXpert,

I would like to think that we are in summer 2008, but the federal goverment's policies with regard to energy production are a wee bit different this time around.

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#4) On May 11, 2011 at 7:28 PM, goldminingXpert (29.64) wrote:

government policy is on psychological in the short term. It takes more than 3 years for a drilling ban to really impact energy production. We'll be paying for Obama's mistake in 5 or 10 years -- not this summer.

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#5) On May 11, 2011 at 7:28 PM, goldminingXpert (29.64) wrote:

is only*

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#6) On May 12, 2011 at 4:15 PM, mtf00l (46.60) wrote:

Um, I don't see the price of gas comming down when "record profits" are available for the taking.

Then, we can look forward to higher food prices as the Army Corp of Engineers floods farm land and fields to save Illinois.

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#7) On May 14, 2011 at 6:24 PM, leohaas (32.65) wrote:

#6: it was farm fields or cities. That's an easy choice, if you ask me.

#4: what in particular are you referring to?

#2: $2? Really? That will be the same day gold is $800.

In general, the days of cheap gas are over. It is simple demand and supply. With the Chinese and Indians wanting and being able to afford cars, gasoline can only go one way. It will be volatile, but the trend will be up because of increasing demand.

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#8) On May 16, 2011 at 11:45 AM, lemoneater (77.43) wrote:

Thought you would enjoy reading my blog on a related topic from 3 years ago. There's nothing like time travel! http://caps.fool.com/Blogs/will-gasoline-go-below-200-a/227787

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