Today’s fuel price musings - Another day, another inch down

Add comment June 11th, 2009

Gasoline prices continue to trickle downward in Rockford, and we’re now 29th in the nation.

The New York Times had an interesting story about how rising gas prices could  slow the economic recovery (and for those of you who think I make this stuff, it also cites the Midwestern refinery problems and the increase in investment activity as keys):

Prices remain well below those of last summer, when the national average for regular gasoline soared above $4, but economists say the recent gains are a growing economic problem and may presage a rise in the overall inflation rate.

“This hits everyone,” said Robert J. Shiller, an economist at Yale. “It has the potential to affect your confidence.” He said that the recent rise in gasoline prices could effectively offset the new $400 to $800 payroll tax cut most employees are receiving this year as part of the Obama administration’s effort to stimulate the economy.

Consumers last summer were pulling $1.5 billion a day from their wallets to fuel their vehicles. By January, as oil prices collapsed, they were spending only $600 million a day. But now they are back to daily spending of around $1 billion, Tom Kloza, chief oil analyst at the Oil Price Information Service, said.

Here’s a scary thought. What if China, India and the rest of the developing world - shielded by government subsidies on energy prices -starts booming again, sending energy price spiking, while we still claw out of a recession? Yikes

Here are the prices from this morning (courtesy of AAA’s fuelgaugereport.com):

Gasoline: Rockford dropped two cents to $2.89 a gallon today. We’re second in the state and 29th of the nation’s 280 metro areas. Chicago remains ahead of us at $2.93. The Illinois average dropped a cent to $2.85 a gallon. The national average rose slightly but remains around $2.63 a gallon. Illinois has the fifth-highest gas prices in the nation, including the District of Columbia

Diesel: Rockford dropped a  cent to $2.58 a gallon. We have the third-highest diesel prices in the state. The state average rose a cent to $2.62. The national average rose a cent to $2.54. Illinois has the 10th-highest diesel prices in the country, including the District of Columbia