Gasoline prices up....refinery usage down.....trouble ahead

[pscot]

http://www.marketwatch.com/story/tides-up-for-gas-prices-little-relief-in-sight-2009-11-06


"Petroleum prices, and particularly gasoline, are very tidal," said Tom Kloza, chief oil analyst at the Oil Price Information Service, with the November through January period almost always producing an off-season bottom, from which prices rally in the late first quarter and second quarter of the next year. ....If this is low tide ... then we are in trouble next spring.'
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Retail prices for regular gasoline averaged $2.6952 per gallon on Oct. 30, the highest level of the year, and the highest price since Oct. 26, 2008, according to data from the Oil Price Information Service.
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They stood at $2.682 on Nov. 5, down 35% from the record level of $4.114 seen on July 17, 2008, but 13% above the year-ago average level, data from OPIS and AAA's Daily Fuel Gauge Report showed. Retail prices have climbed about 9% in a month.

"Any kind of sustained price increases in the fall are unusual, unless the movement is tied to hurricane impacts," said Kloza. "Last time I looked, there were no hurricanes that impacted North American refining in 2009."
Instead, the 20% climb in crude prices from a year ago has combined with refinery shutdowns and slowdowns to spur the spike in fuel prices and there's no denying that the fuel-price level is worrisome at a time when demand is seasonally slow.
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In the backdrop, refinery utilization was at 80.6% of capacity as of the week ended Oct. 30, down from 85% four weeks earlier, data from the U.S. Energy Information Administration showed. And crude futures prices remain strong at about $80 per barrel.
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The biggest factor for the rising gasoline price is crude -- and at first glance, crude's gains look almost illogical....there's a $10 to $20 "optimism premium" included in crude's price. And if the economy is truly heading towards recovery, analysts will expect both diesel and gasoline demand to increase, said John Eichberger, a vice president of government relations for the National Association of Convenience Stores (NACS). That appears to explain the recent movements in the futures markets, he said. "Traders are hoping to capitalize on the recovery by purchasing futures contracts now at lower prices and then selling them when demand kicks in.....(more)
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[Arctic Dave]

1. "optimism premium" Just say speculators for christs sake.

The are already lining up to do the same thing they did us, and to a point, them, again.
No wonder the Saudis are ditching the WTC index.

[Historic NY]

2. I prefer the fu-kers are at it again...Why doesn't the government act?

[depakid]

3. Governments are powerless against geophysical limits

[Bigmack]

5. Governments are powerless against....

and the Great Unwashed is willfully ignorant of.....geophysical limits. Ms Bigmack

[wuvuj]

4. And they call them the FUTURES MARKETS...

...because they anticipate the future....who would have expected this???? :shrug: