Good afternoon everyone.
At the time of this writing (noon EDT), gas prices, as predicted, have soared. Wholesale gasoline is up 18 cents a gallon right now as Rita threatens more oil facilities in the Gulf, while crude oil has added over $3/barrel to $66.
I’ll do the math for you- gasoline is up 10% right now, and that will translate into a gas price hike here very soon (as early as tomorrow).
Preliminary estimate of the oncoming gas price rise:
Its tough to say for sure. Prices haven’t fallen as fast as they have on the stock market, so with that said, they may not rise as much as the market is rising. On the other hand, West Michigan wholesale prices seem to be a bit higher than the Nymex futures (the futures I base my predictions on) so a gas price rise could simply be a reset to 2.699, or as high as 2.799, or even more, if the market continues its upward climb.
**At this time**, I don’t think it should be any higher than 2.799, but stay tuned… it may get worse.
This storm may prove catastrophic as it enters the very warm Gulf waters, and strengthen like Katrina did (went from a Tropical storm upon entry into the Gulf, to a Cat 5 because the water temps reaching the 90s)… preliminary forecasts call for the storm to hit Texas, but there is a large margin of error.
This storm MAY sideswipe New Orleans… forecasts have been changing to call for landfall more eastern than expected, but we’ll see…
Keep your tank full, get gas today!