Tuesday, June 3, 2008
"Falling Demand Pressures Crude Oil Prices"--Dover's Magazine
Crude oil prices are nearly $5 lower than last weeks record high of $135 per barrel, as investors and speculators are convinced that demand is weakening. Reports from several media outlets in the past week have carried predictions of significantly higher oil prices, including that of Texas oil billionaire T. Boone Pickens who predicted $150 oil. But several economic measures suggest higher prices are cutting American consumers appetite for gasoline. The national average price for gasoline this week was up 7 cents to a record $3.944 per gallon.
National average prices for diesel also rose to a new record this week, adding a cent to average $4.778 nationally. High diesel prices are pushing the prices of consumer goods and food higher. Gasoline prices already average more than $4 per gallon in 11 states. The Energy Department said that demand for gasoline declined 1.1 percent in March, and they expect to report a decline over the Memorial Day weekend, although that data wont be available until next week. Despite this weeks decline in crude prices, analysts expect gasoline and diesel prices will continue to rise in the coming weeks. - Greg Henderson, editor