Oil prices plunge after long run-up

[jpak]

Source: CNN

NEW YORK (CNNMoney) -- Oil prices have plunged this week, erasing the gains of recent months and dissipating fears of $5-per-gallon gas ... at least for now.

The price of U.S. crude oil slipped beneath $100 per barrel on Friday, dropping about 4% from Thursday, to settle at $98.49.

Oil prices are usually a predictor of gasoline prices, which typically mimic the fluctuations in oil, although sometimes not until days or weeks later.

In reaction to dropping oil prices, gas prices have dropped about 6.5% over the last week, reaching a national average of $3.802 a gallon on Friday, according to the motorist group AAA.

<More>

Read more: http://money.cnn.com/2012/05/04/markets/oil-prices/

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So, are the Repigs gonna get down on their knees and thank Obama for reducing gas prices?

[may3rd]

1. So, who beats the war drums next week ?

Prices at the pump can't be expected to fall on a whim.

[jpak]

2. Recession in the UK and Spain will probably have more to do with gas prices than war scares

That and real demand destruction in the US in response to high gas prices.

yup

[may3rd]

16. Let me know when people see a gallon of gas for $3.50/gal and post links to where it can be bought

THEN I'll believe the fall in prices

[justabob]

22. bought regular for $3.55/gal yesterday

RaceTrac... no link except to the corporate page
5151 Lemmon Avenue
Dallas, TX 75209

on edit: I suspect in the next couple of days it'll get down five more cents.

[jpak]

24. Wholesale prices are now $2.97 a gallon = gas is now $3.699 in my neck'o

don't hold your breath.

yup

[jpak]

25. It's on track to go below $3.50 by the 4th of July nationwide

http://www.trivalleycentral.com/articles/2012/05/05/casa_grande_dispatch/business/doc4fa57c6ec7303315824423.txt

Obama 2012

yup

[DenverDad]

3. I'm still trying to figure out how

in 2008 $140.00/barrel oil = $4.00/gallon of gasoline

BUT

in 2012 $104.00/barrel oil = $4.00/gallon of gasoline?

[BlueCaliDem]

4. I was wondering the same thing. I'm still baffled, too.

Who was president in 2008 again?

[DenverDad]

9. The same guy who presided over America's first

$1.50 gallon of gas
$2.00 gallon of gas
$3.00 gallon of gas
AND
$4.00 gallon of gas.

[zbdent]

15. don't forget ... the first President in a LOOOOONNNNNNNGGGGG time to

leave the White House with the Dow lower than when he entered ...

[BlueCaliDem]

23. The DOW was -8000 under Bush, correct? Under Obama, consistently 13,000 +

Romney and the Republicans shouldn't stand a chance, but I'll never overestimate the low IQ of a segment of the American electorate enough. These folks, and American corporations, should be ha-ha-HAPPY we still have the electoral college and the two-Senators-a-state-no-matter-how-big-the-state's-populace. They'd otherwise be relegated to annals of American history as another failed political party.

[NickB79]

5. Because $104/gallon is the WTI price, which is increasingly irrelevent

The West Texas Intermediate benchmark oil price has been commanding a smaller and smaller share of the market. The true numbers you should be looking at are the Brent crude benchmark, which has been running quite a bit higher in recent months than WTI.

This might help explain some of the differences in global oil pricing standards: http://www.energyandcapital.com/resources/brent-vs-wti

[DenverDad]

8. Thanks for the link!

[mwooldri]

11. I am no expert but I say Big Oil's profit margins are the factor here.

There's 42 gallons of crude oil in a barrel.

In 2008 the per gallon cost of crude is $3.33.
Now in 2012 the per gallon cost of crude is $2.47.

But then there's different types of crude oil, which need to be refined differently. And these crude oil prices have their own prices depending on their quality.

Federal and State gas taxes play into this too but again it's not the only factor. (e.g. NC gas tax is higher than VA gas tax by 19 cents but the cost of gas around Greensboro NC is about the same as gas in Richmond, VA).

But I stated Big Oil's profit margins are the factor here. The big oil companies are making record profits. That's got to drive up gas prices to a certain extent too.

There's a lot of pieces of the puzzle that make up the cost of a gallon of gasoline. Crude oil price alone on one index on the stock market is only an indicator and a part, but not the whole picture.

[NickB79]

6. Oh goody, falling oil demand indicates another recession on the horizon. nt

[Wellstone ruled]

7. Get real kiddies

we don't have any say as to the retail price. (1) swipe fees are 7-9 cents per gallon,(2)Goldman-Sachs holds the patents on the gas pump pricing. GS sets the price,no suprise.

[JoePhilly]

10. Better put the Fox and Friends on a suicide watch!

[castnet55]

12. A Plunge?

How is a lousy 4% considered a friggin plunge in oil prices. We I see 10% or better that'll be a plunge.

[sarcasmo]

13. Read this good one from a CNBC link, they are falling.

http://www.cnbc.com/id/47295638

[happyslug]

14. I claim Full Credit, I traded in my Dodge Dakota for a Chevy Cruze Eco

I went from 17 miles per gallon to a car getting 44 mpg.

GM says the Cruze can get 42 mpg, but by be careful I have it up to 44 mpg. That is a lot better then 17-18 mpg I was getting from my Dakota. Thus I have cut my fuel consumption by a third. Thus I claim full credit for the drop in demand and the drop in price.

[CenaW]

17. Ha Obama threatened to regulate the traders... . .I notice CNN doesn't mention it. Reuters did.

Here is a link.
http://www.reuters.com/article/2012/04/17/us-obama-oil-idUSBRE83G0O320120417

[Psephos]

19. Price fall is due to bleak Euro and US economic/employment data.

Read it and weep.

http://www.zerohedge.com/news/and-you-thought-american-unemployment-was-bad

[Amonester]

20. And soon... due to electric/hybrid cars' record sales numbers...

that will teach many GD speculator$ a lesson they won't forget!

:hoping:

[progressivebydesign]

18. and they still haven't hit the Bush high of $4.11 national average of July 2008. Imagine that. n/t

[DallasNE]

21. Yesterday Gas Prices Spiked By 16 Cents A Gallon

Here in Omaha, which is a 4.7% increase. Today they shed 2 cents of that increase. All of the stations change in lockstep.

[happyslug]

26. Blame the new pipeline

Nebraska is at the edge of that part of the US getting oil from Alberta Canada. Do to the lack of pipelines from Alberta to the rest of Canada and the US, you had a "captive" oil situation, more oil then could be used OR shipped out, thus prices stayed low.

This has been expected to change, not only when the new pipeline goes through BUT the reversal of another pipeline from Texas to Nebraska, to a pipeline shipping oil from Nebraska to Texas (This change as to the older pipeline was expected about now).

That change (More the reversal of the old pipeline then the construction of the new pipeline) would end the oil surplus in that part of North America, with local gasoline prices going up to the National average. Prior to that switch in direction of the one pipeline, the area was producing more oil then it could USE or SHIP OUT. With the reversal of that pipeline, more oil can be shipped out, thus increasing the price of gasoline even in Nebraska to Alberta area.

The recent drop in price elsewhere in North America is do to an overall drop in demand world wide. Sooner or later the drop elsewhere will match the increase in Nebraska, the Dakotas, Montana and Alberta. Will take a few months but it will happen.

Now, this is a result of a reversal of one old pipeline, when the new pipeline is completed, that same area will pay world wide oil prices no matter how much oil is produced or used.