Hey, I think I learned something last week. Last year during the third week on October, at the end of the week, prices seem to reset down, probably signaling the end of the Chicago Summer Premium. This year, they did the same. In 2002, right around Halloween, there started to be real problems with refineries in Chicago, and then we had a price spike. I can’t predict if the same will occur this year. Not including the CSP, the 0-cent margin price is $1.30 and the 20-cent margin price is $1.51. So, we have the potential to drift down into the $1.30s this week. But no official prediction right now, because I’m not convinced that I’ve got this right. Good no call. Prices rose to $1.59 on Thursday, a suprising price hike similar to what happened in 2002 at the end of October.
Month: October 2003
Until I am convinced otherwise, I am going to factor a 10-cent “Chicago Autumn Premium” into my calculations. With the CAP, the 0-cent-margin price is $1.42 and the 20-cent-margin price is $1.64. The lowest price in town this morning appears to be $1.52. I predict prices will get down to $1.46 by Thursday, and then there will be a price hike. My prediction was WRONG. In fact, prices dropped from $1.56 to $1.50 on Thursday in Standale.
After Mr. Big lost money on the Packers versus the Chiefs, he decided it was time for a rare Monday price hike. I checked with a source that wholesale prices in the area, with all the taxes in already, are at about $1.50 right now, so $1.69 is about at a margin of 20 cents. The $1.50 corresponds to an extra ten cents over NYMEX, which means the Chicago Summer Premium is still in effect. I don’t understand it, but I’ll keep this in mind going forward.
The price of oil has gotten back up to $31 a barrel. I foresee a price hike later this week. $1.57? I posted my prediction at noon on Monday … it appears that Mr. Big ordered a price hike just before then, to $1.69, so while the prediction was correct, I don’t want to be accused of cheating.
There are two things tugging at prices right now. On the one hand, with October here, reformulated gasoline is no longer required to be sold, so wholesale prices to the retailers should be going down. On the other hand, a barrel of oil is above $30 again, after dropping below $27 two weeks ago. NYMEX gasoline prices have had a similar move. Since prices have hardly fallen at all since Thursday, I predict no price hike this week, but no signifcant drops either. (If we get a big move up in oil the next few days, then all bets are off.) The prediction that there would be no price hike was CORRECT.