Thanksgiving price hike, Summer 07 outlook

Hi everyone! Just when I thought we shouldn’t see a gas price hike
before Thanksgiving, it looks like some news on the market may go
against that theory.

Today, I was reading the news that the largest refinery in the U.S.
(Baytown, TX) @ 575,000 barrels was running much lower output today due
to an unknown issue (I couldn’t immediately find out why). That and one
of Citgo’s refineries also went down, adding to worries about gasoline
production heading into the winter.

Coupled with the fact that we’ve seen a 6 week decline of gasoline
stockpiles, wholesale costs are now at 1.60 again, and with a few
stations down to 2.14, I’m pretty sure we’ll see a reset unless they
like to continue to lose money.

Get gas today, or you might see 2.37-2.39 at the pump tomorrow or Thursday.

I was starting to think about Summer 2007 gasoline prices, and with all
the oil cutbacks that OPEC is so blindly making, I’m starting to think
that oil will shoot way up come summer, then hurricane season comes on
the radar… many things coming together… and right now it doesn’t
look good. If OPEC continues to simply cut oil because current prices
are too low, they better be quick to act when oil shoots way up in the
spring because of low oil inventories. They are already talking about
another cut in January, which, if they follow through on, could lower
output by 2 million barrels compared to a month ago. All this could
make gasoline $3.50 or higher. Lets hope OPEC gets it right and at
least puts more oil out come Spring time.

Anyway, have a blessed Thanksgiving!

~Patrick

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1 Comment

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  1. Do you think Opec will comply with the cuts? That has yet to be seen. I doubt they will turn down the chance to make money at $60 a barrel.

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