Archive for December, 2008
December 17th, 2008
According to the New York Times, Republican Rep. Ray LaHood is a leading candidate for Secretary of Transportation. That’s interesting on a number of levels:
- President-elect Obama has pledged to have Republicans in his cabinet, and this is a more likely place than the other outstanding position - Labor.
- Having a downstate Illinois person in that position could help downstate communities looking for transportation funding. Whereas a Chicagoland pol might be pro-Peotone, say, LaHood might continue the positive relationship Chicago Rockford International Airport has with Transportation. Total conjecture on my part, though.
- LaHood is apparently pro-Amtrak, voting on several bills to increase funding. That’s a good sign.
- I’ll admit I was kind of hoping for a person with more of a mass-transit/urban backround to pull Transportation away from simply building roads to try to relieve congestion. It’s clear we need a multi-modal solution to our traffic and gas-guzzling problems, and that needs to come from the top down. But it’s Obama’s vision that counts, not LaHoods, and having a moderate Republican in there maybe could sell some changes better than someone from, say, New York or San Francisco.
Seems like this could be a win for places like Rockford, though having an Illinois politician as president was plenty good. Maybe a Secretary LaHood can help grease the skids on a capital plan in Springfield…
December 16th, 2008
I asked Tom Kloza, chief oil analyst with the Oil Price Information Service, what to make of the rebound in gas prices today. Here are his thoughts:
We broke the streak of consecutive days lower, and we may see an irregular jog (north & south) for the remainder of December. January will almost certainly bring another test of recent lows - it’s the time of the year when a lot of winter gasoline is around, and that gasoline has to be sold before the transition on pipelines and terminals is made to lower vapor pressure spring gasoline.
I’ve described it before as a bit of an enema for the gasoline distribution business. There will probably be firesales on winter gasoline and prices will retest recent multi-year lows. After the firesales, prices will tend to rise into Spring and Summer.
I think the $1.25 gal level or so that we saw for some Midwestern markets earlier this month may get tested again, but I don’t see the case for $1.00 gal or lower prices (as some folks have been predicting).
First 40 days of 2009 will be a rugged environment for oil, and particularly for gasoline. The next 100 days after that almost certainly sees an uptick.
Meanwhile, it looks like OPEC will cut production by 2 million barrels a day, which some analysts have said isn’t enough to move prices up. OPEC’s goal is apparently to get oil up to $70 a barrel, but anticipation of the cuts couldn’t even get oil back above $50 today.
December 16th, 2008
Toby Jones has the solution to your storage needs - come store it in his yard! (Warning, not entirely safe for work, but extremely funny).
Check out his “commercial” for a good laugh (and sadly, no, this is not a real business):
(Kudos to the always entertaining Nick Digilio for the heads up)
December 16th, 2008
Remember how I reported yesterday that Rockford’s gas prices had fallen below much of the rest of the state? No more. By the end of the day yesterday, we’d risen to fifth in the state …and today there was a big increase into the $1.80s. It appears to be an increase throughout the region, so wholesale prices must have jumped. Unfortunately for us, it makes sense - gas prices had fallen faster than oil prices, and oil seems to have stabilized. I don’t see any reason gas prices will top $2 anytime soon, unless OPEC’s production cut is REALLY big. But I’ve been wrong before…Here are the now outdated Tuesday morning prices (courtesy of AAA’s fuelgaugereport.com):
Gasoline: Rockford rose more than four cents to $1.69 a gallon. We had the fifth-highest gas prices in the state. More significantly, we rost to a tie as the 79th highest of the nation’s 250 metro areas. The Illinois average rose almost a cent to $1.71. The national average rose a fraction of a cent to remain at $1.66. Illinois is tied with the 16th-highest gas prices in the nation, including the District of Columbia. Only Alaska and Hawaii remain above $2 a gallon.
Diesel: Rockford dropped more than a cent to $2.63 a gallon. We have the third-highest diesel prices in the state. The state average increased a cent to $2.65. The national average increased a fraction of a cent to remain at $2.54. Illinois has the 13th-highest diesel prices in the country. Only Alaska, Hawaii and New York remain above $3 a gallon (Hawaii is still above $4).
December 15th, 2008
Gas prices in the Rockford area have fallen below much of the rest of the state (and Wisconsin, to boot) and we’re almost in the middle of the country’s metro areas. We’re below the national average, even (and my old town in Indiana surprised me by having prices higher than here).
Too bad there are signs things are bottoming out. Gas prices rose nationally this weekend for the first time in 86 days. OPEC is ready to announce a big production cut, they say. We’ll see what happens, but I wouldn’t expect prices to drop once more.
See how gas prices have fallen with oil, so if oil rises, expect gas prices to do the same:
Here are the prices (courtesy of AAA’s fuelgaugereport.com):
Gasoline: Rockford dropped half a cent to $1.64 a gallon, after a brief uptick over the weekend. We have the NINTH-highest gas prices in the state (Only Decatur and Springfield are below us). We’re down to 118th of the nation’s 250 metro areas. The Illinois average rose a cent to $1.70. The national average dropped a fraction of a cent to $1.66. Illinois has the 20th-highest gas prices in the nation, including the District of Columbia. Only Alaska and Hawaii remain above $2 a gallon.
Diesel: Rockford dropped two cents to $2.65 a gallon. We have the third-highest diesel prices in the state. The state average dropped three cents to $2.64. The national average dropped more than a cent to $2.54. Illinois has the 13th-highest diesel prices in the country. Only Alaska, Hawaii and New York remain above $3 a gallon (Hawaii is still above $4).
December 9th, 2008
From the fine funny folks at Cracked, the 7 Dumbest Things Ever Done by Airport Security (note - not quite work safe).
Not sure which is my favorite - the pilot who got in trouble for carrying a butter knife or the five year old on the “no fly list”.
December 5th, 2008
That all depends. Could the economy hit bottom any time soon? The precipitous drop in fuel prices has been lockstep with the economic downturn - both an actual decrease in demand and projected decreases.
(EDIT - I totally forgot to include the link suggesting those low levels)
As always, don’t expect the lowest price to hit Rockford. If the national average gets near $1, we’d be a bit above that.
I would say I don’t believe prices will get that low … but I’ve been wrong multiple times before. If oiil was soon traded in wampum, I would not be surprised.
On to the prices (Prices courtesy of AAA’s fuelgaugereport.com):
Gasoline: Rockford dropped more than two cents to $1.76 a gallon. We’re tied with the third-highest gas prices in the state (Bloomington and Quincy fell more than us, but we’re now tied with Springfield). We’re tied at 96th of the nation’s 250 metro areas, so we keep falling a bit relative to the rest of the country. The Illinois average dropped more than a cent to $1.75. The national average dropped almost two cents to $1.77. Illinois is tied with the 27th-highest gas prices in the nation, including the District of Columbia. Only Alaska, New York and Hawaii remain above $2 a gallon.
Diesel: Rockford dropped more two cents to $2.77 a gallon. We have the third-highest diesel prices in the state. The state average dropped dropped two cents to $2.81. The national average dropped almost two cents to $2.70. Illinois has the 13th-highest diesel prices in the country. Only Alaska, Connecticut, the District of Colombia, Hawaii and New York remain above $3 a gallon (Hawaii is still above $4).
December 4th, 2008
Yesterday’s gas price drop shows up in today’s numbers, as we fall relative to other metro areass (Prices courtesy of AAA’s fuelgaugereport.com):
Gasoline: Rockford dropped almost three cents to $1.78 a gallon. We have the fifth-highest gas prices in the state, falling below Bloomington and Quincy. We’re tied at 93rd of the nation’s 250 metro areas. The Illinois average dropped a cent to $1.76. The national average dropped more than a cent to $1.79. Illinois is tied with the 27th-highest gas prices in the nation, including the District of Columbia. Only Alaska, New York and Hawaii remain above $2 a gallon.
Diesel: Rockford dropped more than a cent to $2.79 a gallon. We have the fourth-highest diesel prices in the state. The state average dropped more than a cent to $2.83. The national average dropped almost two cents to $2.72. Illinois has the 13th-highest diesel prices in the country. Only Alaska, Connecticut, the District of Colombia, Hawaii and New York remain above $3 a gallon (Hawaii is still above $4).
December 3rd, 2008
I haven’t done one of these in a while because the news has been the same - prices dropping. Yesterday, though, they ticked up a fraction of a cent in the Rockford metro area … but have dropped back down again. Most stations in Rockford are now in the $1.70s on gasoline. Back when we hit $2, Road Ranger President Dan Arnold suggested they could fall another 30 to 40 cents. So the bottom may be in sight…
Prices courtesy of AAA’s fuelgaugereport.com:
Gasoline: Rockford dropped two cents to $1.81 a gallon. We have the third-highest gas prices in the state. We’re also 84th of the nation’s 250 metro areas. The Illinois average dropped half a cent to $1.77. The national average dropped almost a cent to $1.80. Illinois has the 27th-highest gas prices in the nation, including the District of Columbia. Only Alaska, New York and Hawaii remain above $2 a gallon.
Diesel: Rockford dropped more than a cent to $2.80 a gallon. We have the third-highest diesel prices in the state. The state average rose a fraction of a cent to $2.84. The national average dropped half a cent to $2.74. Illinois has the 13th-highest diesel prices in the country. Only Alaska, Connecticut, the District of Colombia, Hawaii and New York remain above $3 a gallon (Hawaii is still above $4).
December 2nd, 2008
Anyone out there still believe gas prices won’t come back down? Because we haven’t seen prices this low in Rockford since early 2005. Back then, Green Day’s “American Idiot” was the top album in the country. OK, when I put it that way, it doesn’t seem so long ago. When adjusted for inflation, prices are lower then they’ve been since early 2004 (Top album would have been something like OutKast’s “Speakerboxxx/The Love Below” … Hey ya, indeed!).
We’ve had an unprecedented drop in the price of gas — more than half. In comparison, the average price of gas went from about $1.40 a gallon in 1981 to 90 cents in 1986. Yet people still find reason to complain. The most common is “why are we higher than the national and state averages?” I want to say, “Well, they’re averages, so somebody has to be above them, just like somebody has to be below them.” But that’s oversimplified, and when it comes to gas prices I try my best to, er, undersimplify things.
Now that prices have normalized from this summer’s insane peaks, you’re seeing pretty standard gaps in pricing around the state and the country. They all have to do with geography — the closer you are to refineries, the lower your taxes are and the lower the cost of doing business is, the lower gas prices will be, generally. First, look at things nationally. On Friday, Illinois’ average was $1.82 a gallon, according to AAA’s fuelgaugereport.com. That made it the 27th-highest state in the nation. We’re right in the middle, which is actually rare for us, we’re usually a bit higher.
If you look at one of the national gas temperature maps out there, you’ll see that generally the farther away from the Gulf Coast states are the higher their gas prices are. That’s because half of the nation’s refining capacity is on the Gulf. Taxes are another big factor — Illinois has some of the highest fuel taxes in the nation, though it’s come down a bit because our sales tax is a percentage, so the lower fuel prices are the lower that tax is.
But what about within Illinois, you ask? Why is the Rockford area — $1.87 on Friday — more expensive than Champaign-Urbana ($1.61), Peoria ($1.659), Springfield ($1.77) and most of downstate? Again, geography. Illinois itself only has about 5 percent of the nation’s refining capacity, and more than half of that is way downstate. The refineries in Chicagoland primarily serve Chicagoland, so we get a lot of stuff from south of here. Also, sales tax in Rockford and Machesney Park are generally 2 percentage points higher than in much of downstate. Finally, it simply costs more to do business in bigger cities. Employees make more, property costs more, insurance costs more, etc. Rockford is still the second-largest metro area in Illinois, so the fact that we’re usually the second- or third-highest metro area in the state makes perfect sense to me. It simply costs more to run a station in Rockford than in Peoria.
Don’t believe me? Try opening one yourself. Or ask the major oil companies why they’ve sold all theirs. There are simpler ways to make money. And simpler things to explain. I think I’ll try astrophysics next. Contact staff writer Thomas V. Bona at tbona@rrstar.com or 815-987-1343.
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