June 6th, 2008
When things get worse, they get worse in a hurry. Oil prices have gone up $13 in two days, reaching a new record of $136 a barrel. Expect gas prices to follow.
What happened? Well, first, the head of the European Central Bank yesterday made some comments about strengthening the euro - and thus further weakening the dollar - that sent the market into a tizzy. As Alaron analyst Phil Flynn colorfully put it, “Mr. Trichet basically said sorry Ben the dollar is your problem and don’t look to Europe to help you out. In fact look for Europe to squeeze you because we are raising rates to squeeze you and drive you into recession because we are in better shape to handle it.”
Then, pouring fuel on the fire, a Morgan Stanley analyst today predicted $150 oil by July 4 because of Asian demand. The oil market took that as a challenge, and prices continued to soar.
A voice of dissent, Shawn Tully of Fortune magazine today said the oil boom will eventually bust (he uses an obvious pun, but The Passenger Seat would never go that route. No, never.).
I’ll say this. Every day, something like this space-age vehicle is seeming more and more attractive.
On to today’s prices (data courtesy of AAA’s fuelgaugereport.com):
Gasoline: Rockford dropped a fraction of a cent to remain at $4.05 a gallon. We’re now second in the state, as East St. Louis dropped just behind us. Most metro areas dipped slightly again today. The state average dropped almost a cent to $4.10. The national average dropped a fraction of a cent at $3.99. Illinois has the eighth-highest gas prices in the nation.
Diesel: Rockford dropped more than four cents to $4.78 a gallon this morning. We now have the third highest diesel prices in the state, dropping behind Quad Cities ($4.80). The state average dropped almost a cent at $4.79 a gallon. The national average dropped a cent to $4.76 a gallon. Illinois is tied with the 19th-highest prices in the country.
Expect all this to change over the weekend.
