Oil prices have set a new record today, trading through the previous record of $111.80 and moving as high as $112.21 in reaction to this week's inventory report.As Joseph Lazzaro discussed earlier, today's move has been in reaction to this week's inventory report out of the Energy Department earlier today that showed both oil and gasoline inventories dropped unexpectedly last week. Analysts had been looking to see oil inventories swell by 2.3 millions, but the report actually showed that inventories dropped by a massive 3.15 million barrels.
Gasoline inventories also fell more than expected last week (3.4 million barrels, as opposed to the 2.3 million analysts were expecting to see) which will only apply more upwards price pressure gasoline prices. Gasoline prices are predicted to move up close to $3.60 a gallon by the middle of the summer, while some analysts are already predicting to see them creep even higher, possibly up close to $4 a gallon.
Overnight, the national average set yet another new record, climbing 1.2 cents to $3.343.
If you are sitting at home and hoping to see some relief at the pumps, I would not hold my breath. It looks like we are in for a long, expensive summer when it comes to filling up our tanks at the gas station.
Michael Fowlkes has worked as a stock trader for seven years and spent the last four years working as an analyst for the online investment advisory service Investor's Observer.
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Reader Comments (Page 1 of 1)
4-09-2008 @ 3:51PM
John said...
Yippee. Fantastic news for my oil stock. I hope America is happy for me because we're getting richer here in the oil patch. Everybody is going to get raises just in time for Christmas.
America still does like for its people to do well, doesn't it?
I smiled when banks did well. Thought it was great. I like rich doctors. I think it's fantastic that football players make great money. It's tremendous that farmers are doing great. That's a big one with me. For decades they were barely getting by: losing family farms left and right. Did you send any donations to farmers? Willie touched me for a few bucks more than once.
4-09-2008 @ 4:14PM
smokin3000gt said...
John, thats great. Atleast the money you make from your oil stock isn't going right back in to your gas tank.
4-09-2008 @ 9:47PM
Art Schefler said...
I suppose there is a hole under the oil and gass reserves that is draining the pool!
I think it will all even out. People will continue to fill their tanks but wll find other ways to save money such as going for a cheaper phone service, cable, etc. When those companies feel the loss of customers, they will react and eventually oil will start going back down.