Monday, October 20, 2014

GAS PRICES - Why the Drop?

"What’s behind the sudden drop in US gas prices?" PBS NewsHour 10/18/2014

Excerpt

HARI SREENIVASAN (NewsHour):  As you no doubt know, gas prices have fallen sharply in recent weeks.  According to AAA, the average price of a gallon of regular was $3.52 in late July.   Now, less three months later, it’s $3.12.

For more, we are joined now by Isaac Arnsdorf.  He is an energy and commodities reporter with Bloomberg News.

So we’ve seen it decline a lot and sometimes there’s a lag between the price of oil and the price of gas.

So are we likely to see the price of gas go lower?

ISAAC ARNSDORF, Bloomberg News:  It could continue to tick down a little bit.  We are seeing oil prices start to stabilize, significantly lower than they were this summer, but it depends sort of where oil goes from now.  If oil continues to its freefall, really, or finds a floor around $80 a barrel.

HARI SREENIVASAN:  And is it likely to last?

I mean, there are so many different factors that are pushing it down.

ISAAC ARNSDORF:  Absolutely.  We’ve got very soft demand globally and expanding supply from the U.S. and really all eyes are on OPEC now to see if they cut back supply or continue to add supply and let prices continue to fall.

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