What Is Going to Happen to Gas Prices?
- By My Money Choice
- Published 03/25/2008
- Budgeting
- Unrated
What Is Going to Happen to Gas Prices?
One of the reasons behind this year's high gas prices is lower than average refinery output in the recent past. Lower refinery output leads to higher prices per barrel of crude oil, and thus higher prices for gasoline. This winter's lower refinery output is largely the result of refinery maintenance; however, lower profits per barrel of crude oil have also caused refineries to drop gasoline production.
The gasoline blend required by federal law in the winter is significantly different than the summer gasoline mixture. This is partially responsible for the typical spring gasoline price increase. The higher demand for gasoline in the summer also typically causes oil and gasoline prices to surge.
There is good news on the horizon, and in the not too distant future. Experts suggest that while gas prices will reach record highs this spring, newly falling crude oil prices will allow for lower gasoline costs in the near future.
Crude oil supplies in the U.S. are on the rise; albeit more due to lower demand than higher production. The failing U.S. economy combined with high gas prices has caused many people to reduce their driving, carpool, or otherwise cut their fuel usage. The changing economic factors behind crude oil pricing have caused prices to begin to fall from their peak levels, and in time, these prices will be reflected in the price you pay at the pump. While low gas prices may never again be a reality, lower ones are in sight in the foreseeable future.
