Posts Tagged ‘gasoline’
Latest Gasoline Prices-The Reasons Why It Is At An All Time Low
Have you ever noticed that the gasoline prices today have reached an all time low? For most people, they would be very happy about it as they will now be able to save a lot of money and get their budget back on track once again.
So, why are the gasoline price today getting lower and lower almost every week? Well, the reason for this is quite simple and it doesn’t need you to be a rocket scientist to figure it out. Basically, like in any other capitalist economy, the law of supply and demand affects the price of the gasoline. Today, because the demand for gasoline has significantly lowered and the supply of petroleum products and oil has increased, the oil companies are trying to sell their products by lowering its price. They are now encouraging people to use their cars.
You have to consider that in the past, the gasoline and other petroleum products have risen in its price. This encouraged people to stop using their cars and go for public transportation instead. Some people even sold their gas guzzling cars in exchange for fuel economic cars and there are also other people who organized carpooling.
These small things have significantly lowered the demand for oil in the United States and made oil companies lower the price of their products. And, thanks to technology, people are now buying hybrid cars. Although it is more expensive than your average car, hybrid cars are very fuel efficient. When you compute the expenses you make in a hybrid car and a conventional gasoline powered car, you will see that the conventional car will incur more expenses on gasoline on its entire life.
Another factor that affected the price of gasoline is tax. Most states today in the country are now lowering the tax for oil products. This means that the price of the gasoline will be lower because there are lower taxes for it.
These are the reasons why gasoline prices today are getting lower and lower. However, you will want to keep in mind that although the gasoline prices are getting lower and lower, the economy is still rather performing poorly. So, you may still want to stick to your budget and focus on saving money. This way, you will be able to have something to turn to in times of emergencies.
Most people today are still not feeling the low gasoline prices because of the poor economy. Although there are some people who are thankful because of the low price of gasoline, you have to consider the fact that there are still many who doesn’t really care as the economy is not yet recovering.
The trend for gasoline prices today are lowering. If you haven’t noticed it yet, you may want to visit your local gasoline station. You will see that the price is much better than the previous months. In fact, more and more people are now filling up their cars because most of them are afraid that this is only temporary and they think that the price will continue on rising.
These are the reasons why gasoline prices are getting lower and lower by the week. However, even if the gasoline prices reached an all time low, you still need to remember that there is the economy to consider.
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Gasoline Prices- Why We Are Experiencing Low Price For Gasoline?
It’s not that people are complaining but you have to consider that the recent fall of gasoline price left you wondering why it happened. And, you really want to understand why in order for you to know if this kind of trend in the price will continue on or will it suddenly stop and reverse.
First of all, you need to understand that there are quite a lot of reasons why we are experiencing a fall in the price for gasoline. You may think about low demand and high supply of gasoline in the world market. Although this is true, this is just one of the many reasons why. There are other reasons that you need to take a look at in order for you to really understand how gasoline prices rise and fall. The supply and demand scenario is just scratching the surface for the reasons why gasoline prices today are at an all time low.
The fact that the demand for oil normally rises during the winter months, it will really leave you wondering why gasoline prices continue on decreasing and the demand for it is too.
One reason aside from the supply and demand factor is that oil intermediaries have credit problems. You need to be aware that the oil industry has a lot more players than we think. Oil intermediaries use the services of contractors in order to do many functions that are essential in the operation of the oil company. For example, you need to remember that the oil is shipped by ocean going vessels and also through pipelines. Also, the refineries that refine the oil to gasoline and other oil products are often separate from the company that products the oil.
Gas stations are also owned independently.
The fact that the sellers want to be sure that they are going to be paid for their product, they often sell to buyers with poor credit. By doing so, it will remove some players as well as some demand from the system. All in all, credit woes can really push the price of gasoline and other oil products down.
You also need to remember that if an oil company can’t ship the oil to countries consuming the oil, it will never be able to sell the oil. The reason for this is that shippers that bring tankers from the ports to the countries consuming the oil are seeing a reduction of available credit. This leads to scarcity of capacity for shipping which also pushes the price for gasoline and other oil products down.
As you can see, supply and demand is not the only reason why oil price and gasoline price is continuing to go down. If this kind of situation continues, you can expect to see gasoline prices go down some more. In fact, analysts have predicted that it will still go down even after Thanksgiving. This will make a lot of people happy, especially people who drove home for Thanksgiving.
These are the things that you have to remember when you want to know about low gasoline prices. It is a fact that the supply is high and the demand for gasoline is low and is a contributing factor to the low gasoline price that we are experiencing today. However, this is not the only reason why gasoline price is low. You need to remember that credit woes of oil intermediaries also contribute to the low price of gasoline.
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Factors On Why Gasoline Prices Continue Falling
Despite the global financial crisis, you may have noticed that the price of gasoline and other petroleum products are continuing to fall. So, why is it that gasoline prices continue on falling even if the whole world is experiencing a financial crisis?
Well, there are basically several factors that contribute to gasoline prices. The first factor is the supply and demand. Because of the significantly low demand on oil, oil companies tend to decrease the price of their oil products, such as gasoline in order to encourage people to buy. There is also a surplus of oil in the world. With an extensive supply of oil, oil companies will want to dispose of it by lowering its price.
So, just why is there a surplus of oil and why is it that the demand for gasoline and other oil products are very low? The answer to this question is that because of the previous oil price increase just a few months ago, people are now more aware of how to save money on gasoline. People are now well adjusted to the lifestyle of having high priced gasoline and up to this day people are still very conservative when it comes to buying gasoline.
And, even if the gasoline price decreased significantly, you have to consider that there is also the world financial crisis. This means that people still continue saving money in order to make ends meet and this includes saving money on gasoline. Besides, you have to be logical and practical these days. Like instead of buying gasoline for your car, you should just buy food to feed your family. That’s how people think these days and they are learning how to conserve gasoline.
For example, instead of using their car to go to work or school, people are now taking advantage of the mass transportation systems, such as the bus, trains and subways. Also, people are now organizing carpooling with their neighbors.
Also, people are now buying hybrid cars. Although the price tag of a brand new hybrid vehicle is much more expensive than brand new conventional gasoline vehicles, the hybrid vehicles are still much cheaper in the long run as it will be able to save tens of thousands of dollars in gasoline consumption.
These are the reasons why demand for gasoline is significantly low and why the price of gasoline is very cheap and at its all time low.
Just the past month, the national price of gasoline has fallen 80 cents to the gallon. That’s how cheap gasoline is today. If you compare the figures, the gasoline price today is cheaper by 40 percent than a year ago. This is quite rare for consumers especially today where the world and the country is experiencing a financial crisis.
Although the economy is slowing down, you have to take a look at the bright side. With falling gasoline prices, the commodities will also fall. With this, you can be sure that the price for commodities will not change or will only show little change. You should try thinking of it as a relief.
These are the reasons why gasoline prices are falling and are still expected to fall by December. Oil companies have rising reserves of gasoline and crude oil. And, with the falling demand, you can expect the price to go down some more.
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Falling Gasoline Prices-A Relief That Everyone Should Be Thankful About
Gasoline is considered to be one of the most important things that modern society needs. Without it, people won’t be able to function normally in society. Today, we should be thankful that the gasoline prices are continuing to go down. So, why is it that gasoline prices continue on falling? What are the factors that affect the price of gasoline and other oil products?
First of all, you need to know what we pay for in a gallon of gasoline. Basically, we pay for 59 percent for the crude oil, 3 percent for refining, 25 percent for distribution and marketing and 13 percent for the taxes. Now, if you take a look at the figures presented, we only pay for just a little more than half for the gasoline.
Anyway, the price for gasoline today is now cheaper than what we had two years ago. For most people, this is really a relief as the country today is now experiencing a financial crisis. With rising price of commodities, the last thing we need is an increased gasoline price. So, just why is the price for gasoline getting lower and lower and is it still expected to get even lower?
The main reason for the low priced gasoline that we have today is the low demand for gasoline. Just last July 2008, we experienced the highest priced gasoline since 1981. Peaking at 4 dollars per gallon, people have started rethinking the way they use gasoline.
Because of what happened last July 2008, people have become more aware on how to save money on gasoline. People started organizing carpools with their neighbors and co-workers, people have started abandoning their cars for public transportation systems, and people also sold their gas guzzling cars in exchange for hybrid vehicles, which is very fuel efficient.
This is basically the reasons why demand for gasoline is very low. In fact, the demand is so low today that by the end of November, the crude inventories have jumped by 7.3 million barrels despite the fact that analysts only expected an increase of 400 thousand barrels of crude oil. And, the gasoline inventory also increased by 1.9 million barrels.
That means that the demand for gasoline is lower by 2.8 percent compared to last year that averaged at about 9 million barrels of gasoline per day. This is good news for people driving back home to celebrate Thanksgiving.
Today, gasoline price is now averaging at 2 dollars per gallon. That’s quite a lot of decrease when you compare it to what it was priced just last July 2008. This means that you can have twice as much gasoline for the same price you pay today than compared to just 5 months ago.
If people continue on saving money on gasoline, you can expect that the price for gasoline will still fall. However, if the demand increases and gasoline reserves dwindle, the price will go back up again. Almost everyday, you will see that the gasoline price continue on falling. Because people are still skeptical that the price trend will continue on like this, they start panicking and filling up their cars. They are afraid that the price will go up.
So, despite the fact that we are experiencing a global financial crisis, we should still be thankful of the fact that the gasoline price today is at an all time low.
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Low Gasoline Prices-How Long Will It Last?
It is very likely that you may have noticed the latest price of gasoline when you visited your local gasoline station. And, you may even have left the station with a smile. Well, that’s what low gasoline prices do and with the gasoline price reaching an all time low, it will surely make everyone who owns a car very happy.
However, this will usually make people ask the question on how long will this price trend last. And, it will also make people ask why the sudden decrease of gasoline price.
First of all, you need to remember that the gasoline price decreased because there is a significantly high supply of oil in the world market. However, because of the low demand for oil, oil companies sold their products at lower prices in order to increase the demand for it.
The reason for the oversupply of oil in the world market is that oil companies anticipated Asia to increase oil consumption. Early this year, Asia consumed a lot of oil that had oil producers and companies worried that the oil reserves they had weren’t sufficient to keep up with the demands. So, what they did is that they increased production and stored vast reserves of oil.
However, because of the world financial crisis, the Asia growth was halted prematurely and the demands for oil decreased significantly. The US demand for oil also decreased because of the financial crisis along with Europe and other parts of the world.
So, will this price trend last?
Unfortunately, it won’t. The oil supplies will eventually get lower as time passes and if there is an increase in demand, the price of gasoline may rise again. It really depends on the demand for gasoline and oil as well as the production of oil.
OPEC will announce a production cut. In fact, there are speculations that OPEC will cut production of oil by a million barrels a day. Russia also indicated that they will join OPEC in lowering its output or production of oil. It is even expected that OPEC will try to cut down production of oil by 1.5 million barrels.
However, the price increase in gasoline isn’t due any time soon. Because of the severe recession in the United States combined with signs of slowing growth around the world, the price of oil will be kept from rebounding further.
Experts agree that the low gasoline price trend will continue on at least by the end of the year. So, you may want to take advantage of the low oil price while it lasts. It will eventually go up again sooner or later.
With the constant demand for oil around the world along with the planned oil production cut between OPEC members along with Russia, you should try to expect that the price of gasoline will significantly rise.
Also, if the economy improves, you can also expect the price of gasoline to increase.
As you can see, the recent price of gasoline is not permanent. It will demand on the law of supply and demand. It will also depend on the world economy. If there is a change in oil supply or even demand by even a little bit, you will see a huge change in the price of gasoline. That’s basically how gasoline prices work. It will depend on the supply and demand for oil.
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The Law Of Supply And Demand- Why It Plays An Important Role In The Low Gasoline Prices We Have Today
The Law of Supply And Demand: Why It Plays an Important Role in the Low Gasoline Prices We Have Today
The law of supply and demand constantly plays an important role in any capitalist business. For example, if you have limited supplies of a particular product and a lot of people want to buy one, you will usually increase the price. Besides, this is a chance for you and your business to earn a lot of money. However, when there is a limited demand for the product you are selling and you have a lot of it on stock, you will normally price it so low that you will only earn a few cents out of every product you sell just to get rid of the product from your inventory.
That’s basically how gasoline works. If there is a limited supply with a lot of demand for gasoline, the price will increase and vice versa. This is primarily the reason why we are experiencing low priced gasoline since 2002. So, just why is it that there is a surplus of supply of oil and gasoline and limited demand for it?
Well, in order for you to understand this, you need to take a look at Asia. In the past months, the oil companies expected Asia, especially China, to significantly grow and increase their demand for oil and gasoline. This is why oil companies began stockpiling oil reserves and increased the prices because of the expected growth of Asia. However, the expected growth of Asia started to cool down early and there is a significantly high amount of oil in the reserves.
And, because the price for gasoline was so high last July 2008, people began saving money on gasoline. The demand for gasoline fell and up to this day, people are still saving money on gasoline. It may be because people became accustomed to saving money on gasoline or the reason may also be because of the world financial crises that we are also experiencing today.
Also, some people are still skeptical that this kind of price trend for gasoline is just temporary. Although this may be true, you have to consider that the price for gasoline is indeed at an all time low.
People today are also more practical when it comes to buying cars. Instead of buying a gas guzzling sports car, people are now choosing fuel efficient hybrid cars. People are now choosing fuel efficiency over power and only people who can afford the high price of gasoline are considering buying a sports car.
Fuel efficient cars, carpooling, and mass transportation systems are the in thing today. Because of this, the demand for gasoline is continuing to fall especially in the United States which is the number consumer of oil in the world. With low demand for oil and a high amount of reserves, the price will normally go down. If people continue on saving money on gasoline which is very likely, the price for gasoline will still continue to fall.
However, there is news that the cutback from OPEC will significantly lower the supply of oil in the reserves. So, you can expect that the oil will stop dropping in price in the next few months and may even start to rise again. So, if you really want to save money today, you may want to start filling up your car and take advantage of the low priced gasoline that we have today.
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Low Gasoline Prices- Saving Money During The Holidays
In a poorly performing economy, many people today are getting depressed especially when the holidays are so near. However, as people drive home for Thanksgiving and Christmas, people eventually give thanks and smile to a very unlikely spot. This unlikely spot is where people usually get depressed especially these past few months. This spot is the gas station.
Today, the low gasoline prices are just what the people need in order to brighten up their day. In fact, the gasoline prices today are reaching an all time low and are still continuing to go much lower. Just compare the price of gasoline today to what it was in July this year. From more than 4 dollars per gallon to less than 2 dollars today, you will see that the price dropped an average of 18 cents a week. For gasoline, that’s quite a lot.
This unusually low gasoline price leaves a smile on every face. In fact, in the West coast, the average price of gasoline is now at 2.12 dollars per gallon. That’s down 24 cents in just a week. In the Midwest, gasoline is now priced at an average of 1.75 dollars per gallon. The East coast is also experiencing low gasoline price with an average of 1.95 dollars per gallon.
This means that the gasoline prices are at an all time low since January 2005. And, with today’s poorly performing economy, many people agree that it’s about time.
Many people consider this as a blessing and even an early Christmas gift. With people today struggling to buy groceries and take care of kids, the low gasoline prices certainly can put a smile on everyone’s face.
Just try to imagine how much lower the price of gasoline is today. If you do a road trip from Dallas to St. Louis, you will spend about an estimate 94 dollars on gasoline. If you made the same drive in July this year, it would have cost you around 200 dollars.
So, why is the price of gasoline continuing to get lower?
Many experts agree that this has something to do with the decreased consumer demand. Because of the gasoline prices last July topping at 4 dollars a gallon, a lot of people and families learned to save money on gasoline. And, because of the savings they saw, they tend to make it a habit and continue on practicing it. They just noticed that doing so made them notice that they had a little more extra in their bank accounts and they sure can’t get enough of it.
Even on Thanksgiving this year, people traveling by road and by private vehicles are down by almost 2 percent. This is very unusual as most people tend to travel by road and by private vehicles during Thanksgiving.
Another reason is the surplus of oil supplies. Oil companies expected Asia to consume more oil but because of the world financial crisis, Asia growth reached a premature halt and so did the oil consumption.
Anyway, because of the decreased demand for gasoline, you can still expect the price to go down by the end of the year. So, try to enjoy it as much as you can as low gasoline prices will not last especially when the oil supplies go down. You can be sure that you will be able to save a lot of money on gasoline during the holidays.
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The Major Factors That Contributed To Low Gasoline Prices
There are quite a lot of reasons why gasoline prices today have now reached an all time low and are still expected to go even lower. It’s not that people are complaining about it but there are some people who are curious even suspicious as to why this happened. Besides, just a few months before, gasoline prices skyrocketed and reached an all time high. It can even be considered as the highest in decades.
So, why the sudden drop in the price of gasoline? Is there something you don’t know that you should know about?
Well, the recent drop in the price of gasoline is not really a mystery that you need to worry about. There are a number of reasons why the price of gasoline has significantly reached an all time low.
The primary reason for the drop in the price of gasoline is the low demand for gasoline. The gasoline reserves in the world are also very high. Now, as the law of supply and demand suggests, low demand with high supply means lower price. As a businessman, you want your products to sell. And, if no one wants it or there is limited demand for it and you have a lot of it in stock, the way to sell it and get people interested in buying your product is to lower its price.
In turn, there are also reasons why supply for gasoline and oil is very high. Basically, oil companies anticipated Asia to continue on growing. In early 2008, Asia’s demand for oil was growing rapidly and oil companies were afraid that the world oil supplies will never be able to keep up. So, logically, they increased production of oil and gasoline. In fact, there are also some speculations that there had been some stockpiling of oil and gasoline prior to the Beijing Olympics.
However, when the world financial crisis hit, there was a significant drop in Asia growth. There are also indications that the growth in Asia is starting to cool down. This left the oil companies with vast supplies of oil and gasoline meant to supply a growing Asia that was overestimated. What this meant was there was a surplus of oil and gasoline currently in stockpile with diminishing demand for it.
Another reason why gasoline is priced so low today is because of the rise in the value of the dollar. Basically, you need to understand that the higher the value of the dollar, the lower the price of oil per barrel which is measured in dollars. Today, the value of dollar is high so the price of oil is low. Also, because the value of Euro has declined against the dollar, it will also contribute to lower gasoline and oil prices.
Another good reason is the world financial crisis. This forced investors of hedge funds to liquidate their positions. Basically, oil futures are the first one they sell on the market because it is the easiest to sell.
These are the major factors that contribute to low gasoline prices. All in all, the world financial crisis as well as the increased supply and decreased demand for gasoline are the primary contributors of low gasoline prices. However, you need to remember that oil and gasoline price is still quite volatile. A small change in the demand or supply can have a huge change in the price for gasoline or oil.
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Low Gasoline Prices- A Reason To Celebrate?
By now, you may have noticed that the gasoline price have reached an all time low. You may even try and fill up your car full of gas which is a very rare occurrence nowadays. However, before you celebrate, you may want to remember that the country is also affected by the world financial crisis that makes everything expensive.
So, just why is gasoline getting cheaper while everything else is getting more and more expensive? Well, there are basically a few factors that contribute to the price of gasoline. The first is the price of oil. As most people know, the price of oil is determined by supply and demand. Today, there is a surplus of oil supplies while there are limited demands for it. Even in the United States, the demand for gasoline is getting lower and lower each day.
Because of this, oil producers will need to lower the price of their oil in order for it to sell. With this, the gasoline (which is basically refined oil) will also be priced lower in order to entice people to buy gasoline. However, because we previously experienced a very high priced gasoline just a few months before, we tend to adapt to the system and prefer the money-saving system. So, people still continue on to practice saving money on gasoline, which means that the demand for gasoline is continuing to decline.
And, combine this with the world financial crisis, people tend to be shrewder when it comes to spending their money and filling their car with gasoline is not one that you may consider as a priority to spend money on.
Another reason why gasoline price is continuing to go down is because of credit problems of oil intermediaries. Oil companies use contractors in order to function properly. Contrary to what most people think, the company that ships oil to consuming countries is not owned by the oil company. The same goes for the refinery that converts oil to gasoline and other petroleum products. In short, credit woes that hit the supply chain of oil push the price of oil down.
The world financial crisis puts pressure on hedge funds. With investors unhappy about the performance hedge funds and who are liquidating their positions are starting to sell oil futures first. Why? Well, oil futures are considered to be the easiest to sell and they sell them early on before the price becomes any lower.
One reason why the oil reserves are very high is because oil companies anticipated that Asia, particularly China will keep on growing and demand more oil. This was halted because of the world financial crisis. Because oil companies anticipated a high demand for oil in the future, they stockpiled oil reserves by the millions in barrels.
As you can see, there are so many factors that affect the price of gasoline. So, is there a reason to celebrate the low price of gasoline? Well, you can be happy about it but it’s really not something that you should make a holiday out of. You need to remember that the world is in a financial crisis. It affects the basic commodities and you may just need to breathe easily that the price of gasoline is not rising along with the price of the basic commodities.
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Low Gasoline Prices- A Great Relief For All People
A lot of people are wondering why gasoline prices today have reached at an all time low when just a few months before, the price for gasoline was really the most expensive since the Iran-Iraq war. Well, it’s not that people are complaining about it but people are really curious as to why this happened. Why the sudden rise in price and the sudden decrease in price?
As most people know, the price of gasoline and other petroleum products depends on the price of oil. If oil is expensive, then gasoline will also be expensive. Now, the price of oil depends largely on the law of supply and demand. If there is a surplus of oil in the reserves and limited demand for it, then the price of oil will be cheap which also means cheap gasoline and other oil products.
Today, there are quite a lot of supply of oil in the reserves and limited demand. This basically explains why gasoline has reached an all time low when it comes to the price. Now, why is it that gasoline is at a very low demand when winter is already coming? This is the time of the year where oil demand is usually very high as people use it in order to heat their homes.
There are quite a lot of reasons why there is a low demand for oil and high supply for it. The first reason is the high priced gasoline only a few months before. People became more conservative when it comes to buying gasoline for their car. Some have started selling their old conventional car and buy new hybrid vehicles that are more fuel efficient. Others are now using mass transportation system such as the bus and subways as a primary way to go to work and school. And, there are also others who organized carpools with neighbors and coworkers in order to save gasoline. People have adjusted to the past gasoline price hike and is continuing to practice it because of the huge savings they made and only realized.
So, just what is the reason for the vast reserves of oil? Well, oil companies thought that Asia is continuing to grow and demand more oil especially China. However, after the 2008 Beijing Olympics, the growth in Asia started to cool down. Also, the growth was affected by the world financial crisis which is also affecting the US today.
Because of this, Asian countries have limited the amount of oil they buy and the anticipated demand didn’t come true. The reserves were unusually high and with limited demand for oil, the price for oil took a plunged along with the price of oil products, such as gasoline.
The world financial crisis is another reason why demand for gasoline and oil is continuing to go down. The fact that people are becoming shrewder when it comes to spending their money, they now save money for emergencies instead of filling their cars with gasoline.
As you can see, there are quite a lot of reasons why gasoline price today is continuing to plunge. In fact, just last July, the price for gasoline was already at its highest at 4 dollars. Just this November, the price went down to almost 2 dollars. As you can imagine, that’s a lot of decrease. These are the reasons why gasoline prices are getting lower and you can continue to expect it to go even lower by the end of the year.
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