Our blogs about
America's Wars
War on Iraq
War on Drugs
War on Afghanistan
War on Columbia
War on Philippines
War on Venezuela

MORE
Matrix Masters
Blogs
World Events
Katrina's Aftermath
US News
Bush Crime Family News
Science & Health
Earth News
Free Speech
News from Africa
News from Palestine
Bill of Rights Under Attack

Support Bloggers' Rights!

Lorenzo's
Random Musings
. . . about Chaos,
Reason, and Hope

 

$4 a gallon gas on the horizon
(Grace Wong, CNN, August 31, 2005)
Consumers can expect retail gas prices to rise to $4 a gallon soon, but whether they stay there depends on the long-term damage to oil facilities from Hurricane Katrina, oil and gas analysts said Wednesday. . . . "There's no question gas will hit $4 a gallon," Ben Brockwell, director of pricing at the Oil Price Information Service, said. "The question is how high will it go and how long will it last?" . . . Brockwell said with gasoline prices now exceeding $3 a gallon before even reaching the wholesale level, it "doesn't take a genius" to expect retail prices to hit $4 a gallon soon. . . . "Consumers haven't seen the worst of it yet," Brockwell said. . . .
He expects consumers in the Southeast and Northeast to be pinched first, following the impact of Hurricane Katrina on the Gulf Coast region. . . . Katrina forced operators to close more than a tenth of the country's refining capacity and a quarter of its oil production, which sent gasoline prices surging. . . . Two major pipelines that supply gasoline to key terminals and distribution centers within the eastern U.S. were shut down due to power outages caused by the storm. . . . In a research note, Behravesh laid out a worst-case scenario that puts average prices for regular unleaded gasoline at about $3.50 a gallon for the next four to six months. . . . "The impact on consumer spending in such a scenario would be very dramatic, cutting the growth rate by as much as 3 percent and pushing real GDP growth in the fourth quarter closer to zero," he wrote. . . . In a best-case scenario, he forecast retail pump prices to peak at $3 a gallon for a couple of months, but then fall back to around $2.50 by year-end.

[COMMENT by Lorenzo: Of course, the economics department at the University of Notre Dame says"Katrina not a major blow to overall economy". It will be interesting to see how well the ND economists fair with this prediction.]

posted by LoZo 3:01 PM