Gas Prices Rise; Have They Hit Bottom?
After nearly three months of continuous drops in prices, we may be seeing the beginning of the end for the quick drop in gas prices.
Gas prices had fallen for 86 consecutive days before rising in back to back days.
According to the American Automobile Association (AAA) regular unleaded gasoline prices have reached $1.663 a gallon on Sunday, up from $1.656 in its Friday report. While not a very significant rise, the gain of an average .4 cents over the past 2 days after falling every day for the last 3 months may point to a bottoming of gas prices.
The current national average is now $2.451 below or 59.6 percent off the record high price of $4.114 that AAA reported on July 17, 2008.
The highest gas prices are in Alaska, at $2.689 a gallon. The cheapest average gas prices are in Missouri, at $1.477 a gallon.
As OPEC is prepared to make a “severe” cut during their upcoming meeting in Algeria this week, we may see a turnaround in the price of crude with gas prices following closely.
What should make it more worrying for consumers at the pumps, is the fact that “these price declines are not being driven by technological change, a new ‘normal’, or conservation,” says Tom Kloza, chief oil analyst at the Oil Price Information Service. “They are being driven by panic liquidation and a temporary visit to prices that make no particular sense in terms of production costs.”
Therefore, if OPEC can shake up the market with a much larger than expected cut, we may see crude oil and gas begin to make a major price turnaround.