Quote:
Originally Posted by gt350mike
Sammy, do think the increase is directly tied to the devaluation of the dollar? Not that it matters for me (I'm going overseas for several months), but what is your opinion on diesel prices?
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The value of a dollar has a direct and almost immediate influence on the price of fuel, with about a 6 to 8 week lag in most cases.
In order to understand what diesel is going to do, watch the price of imported diesel. It's been very cheep over the past two years because demand overseas was down a little, in India, china Russia, Europe, etc. Now the demand is recovering a little over there so imports aren't as cheap and they can't hold down the wholesale price here as much. For the past 2 years refiners have been lucky if they could break even, many lost money.
With oil at $90/bbl, gasoline really should be around $2.70 a gallon wholesale but it's well below that.
As the demand overseas recovers the prices here should be able to equalize, which means more expensive.
That's assuming something unexpected doesn't happen, like the Suez canal shipping getting disrupted.
It only accounts for about 3% of the oil that's shipped world-wide but 3% is enough to completely upset the apple cart until we're rationing odd-even again.
Lots O'info at
U.S. Energy Information Administration - EIA - Independent Statistics and Analysis iffn you have the patience to wade through it.
Info overload at first. I spend prolly an average of 15 minutes a day there and have been for years and still some of it's over my haid.