Is $2.50 A Gallon Gas In Your Future? Oil Prices Start To Free Fall

Gas is getting cheaper for several reasons:
1. Speculation of world demand led to premature increases (no real factors just speculation).
2. Demand is down becuase people are driving less
3. The global demand has dropped rather than increased.
4. Many of the Gulf refineries are still off line and as soon as they come on line there will be a flood of oil with nowhere to go.

All of there factors will come into play IMHO.

— Agent009 (View Profile)

Posted on 10/7/2008 10:52:52 AM | reply to this comment | Votes: 5   

Ahhh....

009 you missed one critical issue. Here in the US, we just started switching to Winter Standards for fuel. So of course fuel would go down this time of year.

However I would be cautious to listen to anything the oil speculators talk about. Remember these are the people who less than 3 years ago said oil wouldn't go above $40 a barrel.

Of course I do agree with point 1. Points 2,3 and 4 could be right...however in my mind are a bit speculative.

World oil use has not decreased, People driving less (short term) will have very little impact on oil price. Petrochemicals, Jet A fuel and Heating fuel are where the largest impacts will occur.

With colder weather already beginning to hit the north and the mountainous regions, the need for heating fuel will likly rise dramatically in the next few weeks even if the demand for auto fuel dosent. This will begin to tax the refineries we currently have in place and some of the ones we bring back online.

These are some of the factors that need to be looked at as well when determining what fuel prices will be.

— Spectator (View Profile)

Posted on 10/7/2008 1:05:07 PM | reply to this comment | Votes: 0   

I do mostly agree with 009. My only hesitation is that I think OPEC has gotten too greedy and will cut production if demand drops.

— daytonaviolet (View Profile)

Posted on 10/7/2008 1:45:20 PM | reply to this comment | Votes: 4   

One thing is for sure..they all need cash flow. So if it isn't selling they will drop the price until they do.

— Agent009 (View Profile)

Posted on 10/7/2008 3:24:13 PM | reply to this comment | Votes: 1   

This is a trick by the oil cartels, they see the rapid development of alternative fuel vehicles and hybrids and want to deceive us into slowing down the progress, once we are complacent again, they'll jack it up even more, and so on, a vicious cycle.

— sector (View Profile)

Posted on 10/7/2008 10:31:15 AM | reply to this comment | Votes: 6   

once gas gets to say $2.50 they are going to raise it again and say that more people are driving again we can't afford to keep it that low...same B.S. cycle is going to happen again

— 350zdon17 (View Profile)

Posted on 10/7/2008 10:42:07 AM | reply to this comment | Votes: 4   

Agent009, can you blow up that pic of the girl wearing those Audi booty shorts? Looks like a fine backyard.

— SHOWTIME (View Profile)

Posted on 10/7/2008 10:55:12 AM | reply to this comment | Votes: 5   

Catastrophe causes change.
Expensive gasoline is the best thing that has happened to the planet.
My next vehicle will be a ZEV, regardless of gasoline prices.

— topneuro (View Profile)

Posted on 10/7/2008 11:04:55 AM | reply to this comment | Votes: 3   

Election year..prices always drop a month before the us presidential election.

— snatchandgrab (View Profile)

Posted on 10/7/2008 12:59:21 PM | reply to this comment | Votes: 6   

Didnt OPEC just say that they dont want prices below $100, and will be slowing production to keep prices there?

— thetruth01 (View Profile)

Posted on 10/7/2008 1:31:44 PM | reply to this comment | Votes: 3   

Regardless, we need to start drilling here and/or develop alternative solutions.

— daytonaviolet (View Profile)

Posted on 10/7/2008 1:47:36 PM | reply to this comment | Votes: 1   

Hopefully the general public will understand what is going on. In the face of huge truck and SUV rebates, buying a gas guzzler is rolling the dice.

— t_bone (View Profile)

Posted on 10/7/2008 2:04:18 PM | reply to this comment | Votes: 1   

Gas should be $2.50 now. It is currently trading at $2.02 per gallon. Add taxes and it should be hovering around $2.50 to $2.60 right now. We are currently paying $2.78 a gallon in South Texas.

— rocker (View Profile)

Posted on 10/7/2008 2:50:13 PM | reply to this comment | Votes: 3   

i agree with all 5 points, BUT In my opinion there is more to in, lookin from a marketing presective.

Oil companies have just found a really nice equilibrium point where at a dollar (canadian) or 2.50 ameican they make the most profit, as they go higher they make less money, if they go lower they make same/or less money. At a dollar more people will be buying and will me more dependant on fuel as opposed to when its high then less people will be dependant. Same thing goes when lower them a buck, even more people will buy therefore more gas will be wasted at same profit. Get my drift?

— Kiriller (View Profile)

Posted on 10/7/2008 4:04:14 PM | reply to this comment | Votes: 2   

Remember when crude prices were following the stock market . The maket would go down . Oil would go up. Market would go up , oil would go down . I think all that was for a bunch of market traders would buy when it would go down and sell when it went up . Repeat the process seversl times and I'll bet there was people that doubled their money

— toolatetorace (View Profile)

Posted on 10/7/2008 10:11:57 PM | reply to this comment | Votes: 1   

According to OPEC, they'll cut supply if it hits $80. Which makes complete and total sense. What a bunch of crooks. Keep in mind, also, that taxes are a huge part of gas prices. Prices vary by as much as a dollar or more depending on the city/state that you reside in. Now THAT is crazy. Why doesn't anyone look at gas taxes in addition to Big Oil and OPEC?

— BiasFreeSince83 (View Profile)

Posted on 10/8/2008 7:52:01 PM | reply to this comment | Votes: 1