October 17, 2006

NOTHING TO INFLATION BUT FEAR ITSELF:

At $2.21 a gallon, have gasoline prices bottomed out? (TIMOTHY C. BARMANN, 10/17/06, Providence Journal)

Here's where we were yesterday. The state average price of gasoline was $2.219 a gallon, down another 3 cents from last week, according to the state Office of Energy Resources. The average price has fallen for 11 consecutive weeks, dropping a total of 89 cents a gallon since this year's peak of $3.109 a gallon in late July. Yesterday's price is a penny away from tying the lowest price of the year -- $2.209 in February.

To understand the dramatic drop, consider what happened last spring and summer, said Peter Tertzakian, chief energy economist of ARC Financial Corp., a Canadian firm in Calgary, Alberta.

Weather forecasters warned that the United States was in for a busy hurricane season that could disrupt the flow of fuel from the Gulf of Mexico; war in Lebanon broke out; the nuclear standoff with Iran was heating up; and corrosion in the Alaskan pipeline disrupted supply to the mainland.

"We had all these issues that were percolating, driving prices higher and higher," said Tertzakian, who is author of the book, A Thousand Barrels a Second.

"It's fair to say it was a fear factor," he said.

Posted by Orrin Judd at October 17, 2006 5:26 PM
Comments

Fear factor, yes, but fostered at every turn by the gloom and doom of the MSM in their BDS.

Posted by: Lou Gots at October 17, 2006 9:05 PM
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