Fuel prices: the bright spot in downturnPosted on
It comes too late in the year to be of much help to the marine industry, but the one bright spot in an otherwise economically volatile autumn has been the steady downward trend in gasoline prices.
The descent began in August, after prices hit all-time highs in June and July and were threatening to go even higher. Unfortunately, the principal factor in the decline, experts agree, has been the weakness in the global economy and a corresponding drop in projected demand for petroleum products.
In the most recent U.S. Department of Energy fuel price report (Nov. 10), the nationwide average price for a gallon of regular gasoline at the pump had fallen to $2.22. That’s 17.6 cents less than the preceding week and down 88.7 cents from a year ago. It’s also more than $2 a gallon below the midsummer peaks.
Prices at the fuel dock typically run 30 to 35 percent higher, in part because marinas, given their proximity to the water, factor in their additional insurance costs for fuel spill coverage.
The Lundberg Survey, the private firm that tracks fuel prices, said in November that barring a short-term deep reduction in global demand for oil, gasoline prices may soon hit bottom.
“No one knows at which precise point falling prices would cause demand to stop shrinking or to grow,” Lundberg said. “Whenever that might be, it will be within the context of how the overall economy is performing.”
None of the experts can say with certainty when prices will rise. On one point, however, they do agree: The low prices now are a temporary phenomenon.