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Peak Gas Prices?

Tyler Durden's picture





 

Wholesale gasoline futures are down around 8% from their late March peak. This follows the late February peak in WTI crude prices. Joseph Brusuelas of Bloomberg's Economics Brief today asks whether this signals a peak in retail gas prices - which are up around 20% this year. In a very similar seasonal and monetary cycle manner to last year, energy prices are rolling over but will retail follow again this time as it did before. For sure this would provide direct releif to households, as Brusuelas notes, that have seen average hourly earnings decline for 13 consecutive months. The typical lag is 2-4 weeks before wholesale improvements start showing up in retail prices and while we wait with baited breath for that spending relief, we note that at the same time, the average price of gasoline in Europe just broke back above $10 per gallon (equivalent) to its highest in almost a year showing no signs of retracing at all.

Gasoline futures turned down after WTI prices peaked in late Feb - will retail gasoline prices follow this time?

While European gas prices continue to make new highs...

 

Charts: Bloomberg

 


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Fri, 04/20/2012 - 09:49 | Link to Comment Oh regional Indian
Oh regional Indian's picture

How about a small addition to that headline;

Manipulated Peak gas prices?

Petrol (gas) in India is approximately $9 a gallon and looking to go up.

Diesel, the more expensive distillate is $6 because an inch higher and trucker strike, inflation goes hay-wire and th eprice of ONIONS skyrockets.

Also, you just need to look a leedle bit at the other gas, NG.... quite the tell, especially if, god forbid, a late winter storm hits.

ori

/socthr-e-never-too-late/

Fri, 04/20/2012 - 10:14 | Link to Comment GasPump
GasPump's picture

I HAVE YOU ALL BY THE BALLS! MUHWHAHAHAHAHA!!!

Fri, 04/20/2012 - 09:58 | Link to Comment hedgeless_horseman
hedgeless_horseman's picture

 

 

 

I would like to personally
thank apologize to
all of our troops
for having to defending
our nation the petrol dollar.

 

 

Fri, 04/20/2012 - 09:59 | Link to Comment BlueCollaredOne
BlueCollaredOne's picture

You are the master of strikethrough.  One of these days Im going to donate

Fri, 04/20/2012 - 10:01 | Link to Comment Flakmeister
Flakmeister's picture

They are doing a "helluva job" aren't they?

They are literally killing themselves in defence of the petro-dollar....

A veteran commits suicide every 80 minutes

Fri, 04/20/2012 - 10:08 | Link to Comment Oh regional Indian
Oh regional Indian's picture

nvts...sad....and a huge symptom of the asleep-ness of it all. The system, the people....

ori

Fri, 04/20/2012 - 10:57 | Link to Comment hedgeless_horseman
hedgeless_horseman's picture

 

 

http://www.ar15.com/forums/t_1_5/1313339_Blackwater_hits_woman_with_truck__shoots_at_traffic.html&page=3#i33440831

 

 

 

Lord, grant us each a little empathy.

Help us to understand that freedom, liberty, and private property are meaningless terms unless they apply to everyone.

Amen.

Fri, 04/20/2012 - 12:25 | Link to Comment aerojet
aerojet's picture

All according to plan.  Veterans have never been treated well in any era--the Bonus Marchers are a great example.  You have to understand that when you sign up to serve in the military, you are giving up your life and that it is as unglamorous as it gets.  And to top it off, you aren't even fighting to preserve freedom in the US because our government is going full-tilt trying to limit freedom and surveil everyone, so the best thing you could do is simply not serve because it does less damage to the world and to our own country if you withdraw your consent to let the elite use you as their little pawn.  Find a better way to serve!

Fri, 04/20/2012 - 14:45 | Link to Comment DaveyJones
DaveyJones's picture

we've all got blood on our hands for puttting up with this self destructive bullshit 

Fri, 04/20/2012 - 10:01 | Link to Comment Stoploss
Stoploss's picture

+100

Fri, 04/20/2012 - 10:08 | Link to Comment LongSoupLine
LongSoupLine's picture

Well done HH...well done.

Fri, 04/20/2012 - 10:10 | Link to Comment GeneMarchbanks
GeneMarchbanks's picture

Yeah, what about your 'allies' who will probably have to ration soon so you can get a head start on Operation Irani Liberation. What about them?

Fri, 04/20/2012 - 10:17 | Link to Comment hedgeless_horseman
hedgeless_horseman's picture

 

 

Europeans have walkable communities, better local food production, and adequate commuter rail.  You are the one's with the head start, my friend.

Fri, 04/20/2012 - 10:27 | Link to Comment GeneMarchbanks
GeneMarchbanks's picture

Ha. Well said. Now, kindly search 'Nabucco' to find out who runs EU energy policy. If there is one thing we will do together it is pulling the trigger on barrels aimed perfectly at our own feet. Ready?

Fri, 04/20/2012 - 11:32 | Link to Comment whatsinaname
whatsinaname's picture

Its the weather silly..

Fri, 04/20/2012 - 09:57 | Link to Comment Flakmeister
Flakmeister's picture

Prices typically peak around Memorial Day...The thing to watch is if the pull back is consistent with historical norms.

Smart money is starting to accumalate conventional NG assets with a 18-24 month timeline...

Fri, 04/20/2012 - 10:10 | Link to Comment Idiot Savant
Idiot Savant's picture

Edit: The thing to watch is if Israel attacks Iran.

Fri, 04/20/2012 - 10:39 | Link to Comment SheepDog-One
SheepDog-One's picture

Israel will never front an attack themselves, theyre figuring out how to make us do it for them, see Lavone affair, USS Liberty, 9-11, etc.

Fri, 04/20/2012 - 10:09 | Link to Comment MachoMan
MachoMan's picture

No...  but the increases in price should sufficiently kill demand to help create a temporary ceiling...

Fri, 04/20/2012 - 10:10 | Link to Comment Whoa Dammit
Whoa Dammit's picture

We could have much lower gas prices if raw materials and parts for consumer junk wasn't shipped all over the world several times before the end product is actually sold. Globalism is an costly dinosaur.

Fri, 04/20/2012 - 10:12 | Link to Comment El Viejo
El Viejo's picture

http://globaleconomicanalysis.blogspot.com/2012/04/demographics-and-changing-social-trends.html

Demographics affect more than just gas. Boomer retirees will spend less on everything.

Fri, 04/20/2012 - 12:20 | Link to Comment aerojet
aerojet's picture

It's true--dead people don't consume, but rather they are consumed (by worms).

Fri, 04/20/2012 - 14:50 | Link to Comment DaveyJones
DaveyJones's picture

no but dead people's debt does

Fri, 04/20/2012 - 10:11 | Link to Comment Hohum
Hohum's picture

Stock market goes up; oil/gas go up.  Stock market goes down; oil/gas go down.  It's worked pretty well for three to four years.

Fri, 04/20/2012 - 10:14 | Link to Comment onlooker
onlooker's picture

Refinery “maintaince” about June first or July. Remember tax is based on price, the higher the higher. And, oil companies donate to the election, got to keep Exxon, Sunoco, and Halliburton happy.

 

We need a well led consumer petrol strike. Car pool, better planned shopping, local vacations, more 4 day work weeks. With all the go green gaffs, this could be an easy one that works, if the Nation had any leadership.

Fri, 04/20/2012 - 10:16 | Link to Comment boiltherich
boiltherich's picture

The typical lag is 2-4 weeks before wholesale improvements start showing up in retail prices

 

The typical lag I have noticed here is that retail prices rise on the same day the wholesale market goes up, but the lag for the price drops in retail from wholesale run 2-4 weeks after a drop in wholesale, and as long as 8 months if ever for them to go down as far as wholesale.  The gap in the industry is called the Rack to Retail and it used to run between 10 and 30 cents as recently as 2006, it is now over $1 per gallon which might not sound like a lot till you consider how many billions of gallons per month we consume.  By the way, federal sales taxes is included in the wholesale price, but not state.  We here are down 2 cents from the peak as of yesterday.

Fri, 04/20/2012 - 10:24 | Link to Comment Hohum
Hohum's picture

Do gasoline stations really make much of a profit on the gas?  Isn't the gasoline an enticement to buy what's inside the store--where the real profit is?

Fri, 04/20/2012 - 10:31 | Link to Comment SheepDog-One
SheepDog-One's picture

I never buy anything but gas at a gas station myself.

Fri, 04/20/2012 - 10:41 | Link to Comment DCFusor
DCFusor's picture

Smart move SD, but most aren't that smart.

Fri, 04/20/2012 - 10:43 | Link to Comment SheepDog-One
SheepDog-One's picture

I guess it doesnt matter when most people just swipe their EBT card anyway.

Sat, 04/21/2012 - 08:28 | Link to Comment CPL
CPL's picture

You can buy the rights to the store, like a condo you own everything from the paint into the store.  one of the lousiest business opps on the planet.

 

First you get fucked by the fact your supplier dictates price, then you get to listen to every annoyed customer.  One of the ladies I know runs one, profit is whatever retail trade you can squeeze out of the place.  Gas isn't the lure btw.  Cigarettes, nevada tickets and lotto is.

Fri, 04/20/2012 - 12:28 | Link to Comment zuuma
zuuma's picture

Hmmm...

Maybe "Rack"/  30 cents in 2006  = $1.00 in 2012   (= 5 cents in 1970)  ??

Gas is not rising/ high priced. 

The dollar is falling in value.

Given the trillions printed in the last 3 years,  a dollar is a lot less special than it used to be.

Fri, 04/20/2012 - 10:20 | Link to Comment Muddy1
Muddy1's picture

"While European gas prices continue to make new highs..."

Hey Europe how's that"Hope and Change" working for you?  Do you like the results of Obama's sanctions against Iran?  No Lybian oil?

Fri, 04/20/2012 - 13:02 | Link to Comment Colonial Intent
Colonial Intent's picture

Libyan oil is sweet, not a lot of those refineries around in europe.

Plus we had an ex-SAS merc in there with 100 lads pre-kickoff to look after the oil till it was..........liberated?

Fri, 04/20/2012 - 10:24 | Link to Comment blu
blu's picture

Another manipulated statistic. It will go down until the bitching about gas pricing stops, thus removing any threat of legislative actions, and then it will start back up again.

Lies. It is all lies.

Fri, 04/20/2012 - 10:34 | Link to Comment SheepDog-One
SheepDog-One's picture

What bitching about gas prices? All the media informs us that we LIKE higher gas prices, we've 'grown accustomed to high prices' see?

Fri, 04/20/2012 - 10:32 | Link to Comment SheepDog-One
SheepDog-One's picture

'Peak gas price'....well certainly not if Bernank is to deliver his 'QE NEW' as everyone believes is already a done deal and coming within weeks.

Fri, 04/20/2012 - 10:34 | Link to Comment adr
adr's picture

All I see is that crude was down 1.5% yesterday and is up 1.5% today. Is there a reason beyond speculation? Nope.

The market is now controlled by a handful of giant players that pull money out when they need to, and push free money from the Fed in when they get it.

You would think that the massive 30%+ rise in many stocks since Jan 1 would have meant analysts should have increased their earnings expectations, but know they lowered them once again to allow corporations to beat.

Nearly all the beats are actually misses by miles if you take three months worth of BS growth into account. Based on stock performance most of the expectations for earnings should have been doubled. Apple's stock ascension pegged earnings at what $45 per share or more? What are analysts expecting? Half that?

Screw the market, it needs to be shut down. Food prices doubled, oil price tripled, other commodities through the roof. All because the level of speculative buying has increased over 5000% in the last decade. Speculators selling to other speculators creating bubbles everywhere. Then you have the Fed that has given the speculators free cash to bet with, making the problem even worse. Take away central bank cash and oil goes to $50 a barrel overnight. Corn and wheat drop by 75%.

Taking up the ass so some hedge fund titan can make another million. Boy life is fun in the new normal.

Fri, 04/20/2012 - 10:47 | Link to Comment Village Smithy
Village Smithy's picture

While I agree with everything you said, I think you need to get laid.

Fri, 04/20/2012 - 10:58 | Link to Comment aerojet
aerojet's picture

And Baby Boomer retirements would be wiped out...

Sat, 04/21/2012 - 08:30 | Link to Comment CPL
CPL's picture

You honestly think there is anything inside those pension fund you would be mistaken.

 

The whole industry runs like a bookies palace.  It's all markers and IOU's.

Fri, 04/20/2012 - 15:01 | Link to Comment DaveyJones
DaveyJones's picture

while everything is criminal and controlled, there are other truths which make the "controlled" monetary price a little moot like, the amount of energy out for the amount of energy in. There is no way around that rapidly growing problem. 

Fri, 04/20/2012 - 10:37 | Link to Comment monopoly
monopoly's picture

Peak gas prices. I don't think so. Long way to go.

Fri, 04/20/2012 - 10:39 | Link to Comment SheepDog-One
SheepDog-One's picture

Little rest before another charge higher. Seriously, people believe prices are coming DOWN now? Due to what, abolishing of 'easing' as our economic policy? Give me a break.

Fri, 04/20/2012 - 10:37 | Link to Comment bobola
bobola's picture

I rode a bicycle to work today.

Third 2 wheel commute this week.

Gas prices going up..???

Let it rise............

Bike Club.!!  Who's with me...???

Fri, 04/20/2012 - 10:45 | Link to Comment DCFusor
DCFusor's picture

You can grab the door handle on my Volt as I cruise by if you need a tow.

Fri, 04/20/2012 - 10:56 | Link to Comment aerojet
aerojet's picture

Enjoy the rain, and the snow (depending).  I like bicycles, but they're toys, okay?  My commute takes me through some difficult intersections.  There are a lot of car crashes, and people don't see motorcycles or bicycles.  It only takes one asshole to smoke you on your bike commute to work and there are a lot of assholes and a lot of days to find one.  So how much are you saving and what are the risks you are assuming to make that savings?  For me, it's a no-brainer--stay in the fucking car!

Fri, 04/20/2012 - 11:11 | Link to Comment SoNH80
SoNH80's picture

Absolutely.  I was an enthusiastic bicycle commuter/tourer until the day that some dingbat in a minivan decided to *not* stop for a red light-- missed me by about 2 inches at 35 mph.  The automobile devours all, you can't beat 'em, so join 'em.  The real alternatives to driving are (1) buses, trolleys, and trains, and (2) walking on a separate sidewalk.  Your health/safety ratio is a lot higher on foot vs. a bike.

Fri, 04/20/2012 - 11:01 | Link to Comment AldousHuxley
AldousHuxley's picture

rain, snow, gusts, uphill, 2nd passenger, large purchases, etc.

 

 

 

Fri, 04/20/2012 - 11:07 | Link to Comment Bicycle Repairman
Bicycle Repairman's picture

Remember to take your bicycle in for a tune up every 3 months.  Or bad things will happen.

Fri, 04/20/2012 - 11:15 | Link to Comment Canada01
Canada01's picture

Been doing that for a while.

Very few people are doing it however, savings are huge !

Fri, 04/20/2012 - 10:39 | Link to Comment pleseus
pleseus's picture

Oh no.  You know what that means.  Deflation.  Just in time for June and a big QE3 announcement.

Fri, 04/20/2012 - 10:40 | Link to Comment SheepDog-One
SheepDog-One's picture

And then by August, $7 gas...let them have fun with that.

Fri, 04/20/2012 - 10:54 | Link to Comment aerojet
Fri, 04/20/2012 - 10:55 | Link to Comment roadhazard
roadhazard's picture

I have watched oil prices close since 08'. What a snow job is going on. Supply and demand, my ass. Oil goes up five dollars and drops back one, then goes up ten dollars and drops back five, then goes up ten dollars and drops back five.  Always pushing the limit finding out how much Americans can stand. Oil prices will rise on the "HOPE" the economy is coming back. All the while consumption goes down, new oil finds discovered almost monthly. What a joke.

Thank the gods I have gotten my ducks in a row and only drive when I want to. I pity the poor commuting bastards in the 'burbs. America will not grow paying $3.50 a gal. let alone $4 or $5.

Fri, 04/20/2012 - 10:59 | Link to Comment orangegeek
orangegeek's picture

Odd that in 2008, unlead gas spot peaked at 3.60.  Today, the world is freaking over expensive gas, yet gas peak in April around $3.44 and has falled to $3.10 since then.

Isn't that weird?

 

Love those oil companies.

Fri, 04/20/2012 - 12:17 | Link to Comment ljag
ljag's picture

Here in Missouri, gas is getting ready to drop to $.20 per gal..............in pre-1965 silver coins, of course.

Fri, 04/20/2012 - 11:04 | Link to Comment Bicycle Repairman
Bicycle Repairman's picture

Gas over $4 a galllon means the real economy has a heart attack and we change Presidents.  Plenty of motivation to manipulate the market and keep gas under $4.  And that is exactly what is happening.

Fri, 04/20/2012 - 11:15 | Link to Comment SoNH80
SoNH80's picture

Strangely, there are still geezers tooling around in mega R.V.'s on our Interstates, with cars being towed by the R.V.'s.  WTF.  I guess there's plenty more inherited-farm-sold-off-to-subdivision-developer-invested-in-90s-bull-market money to burn out there.  Could you imagine getting 100 gallons of diesel a pop for roughly $450-500 to lug your damn RV around?

Fri, 04/20/2012 - 11:45 | Link to Comment Shizzmoney
Shizzmoney's picture

Gas will not hit $5-$6 dollars this year (unless North Korea pulls a nutty). 

Even Republicans can't let it happen (even tho they'll love it to blame Obama) b/c they are in bed (moreso than Dems) with Big Oil that they might get blamed in an election year. 

Hell, they'll all get blamed.  And as much as you *think* these guys hate each other in Washington......they don't.  It's really all a ruse; just ask the country club in Washington, DC how often Boehner, Cantor, Biden, and Obama golf together.

Just wait until 2013.  Then the political class, on either side, has all the time and politcal capital to wage war with Iran, and then allow gas to go up to $5-$6 and tell the rest of us to "deal with it".

 

Fri, 04/20/2012 - 12:21 | Link to Comment Herkimer Jerkimer
Herkimer Jerkimer's picture

Give yer head a shake Durden!

 

"typical lag is 2-4 weeks before wholesale improvements start showing up in retail prices"

 

C'mon up to Canuckistan, where that oil price moves up a smidge and they jump those prices up so fast. Funny, they're kind of slow coming down.

 

Most recently, us Canucks have had to endure that the reason for the rise in gas prices is the switch from winter to summer gas!

 

I'm glad they're so forth coming with the explanations!

 

Just thought I'd set you straight, pal!

 

•J•
V-V

Sat, 04/21/2012 - 08:49 | Link to Comment CPL
CPL's picture

I see a lot of denial in this thread. 

 

Places like the Philippines are in rolling blackouts right now.  No diesel, no coal = no power.  No power = no offshored accounting services, no tax processing, etc..

Indian industrial capacity is at 60% of where it should be.  That gmail outage, the amazon enterprise cloud services, Apple cloud, microsoft cloud were shut down on Thursday because the power  company rationalization and executive decision to either leave data centers running or water filtration services for Delhi.  Same thing for india.  no power, no computer data centers = all those back office jobs suddenly don't produce anything.

 

Pakistan...sigh...They can't even make ice right now.  It's gone way past the water filtration and street lights stage.  The partner in the war on whatever can't deliver basics like munitions to NATO forces.  Planes are nifty, but they don't do a very good job at shipping 2000 tonnes of bullets and shells.

 

Want to see what the world looks like right now without the western rose coloured filters?  Turn on safe browsing/proxy browsing.

 

Go to google news.  Put this string in the search field.

(oil|crude|diesel|electric|electricity) (energy|fuel|power) (peak|change|broke|default|expansion|availability|supply|import|inventory|delivery) (low|high)

Add any country to the search string.  Set to "last 24 hours".  The picture becomes clear inventory levels are well past critical for every Nation on the planet but Russia, Canada and some countries in MENA.


Sat, 04/21/2012 - 09:49 | Link to Comment CPL
CPL's picture

Some links of interest.

http://articles.economictimes.indiatimes.com/2012-04-19/news/31367661_1_...

dozens of these...every hour...RFI's and Announcements hundreds of them a day from Indian manufacturing facilities to obtain ANY diesel.  I understand winning the diesel lottery is a big deal, difference between 20000 people working a week or not working per factory.

 

http://oilprice.com/Energy/Energy-General/Gazprom-Vietnam-All-Hands-on-D...

Once allies in communism and principal trade partners, now at each others throat for ANY drop of oil.

 

http://af.reuters.com/article/topNews/idAFJOE83J07O20120420?feedType=RSS...

Kenya and Somali getting pissy because a border is in the way of Oil exploration.  The locals know enough they don't have to fight the US troops.  They just kill the engineers looking and exploring now.  Then you've got a platoon of troop with their thumbs up their ass, eating, shitting and doing nothing.

 

http://www.esi-africa.com/node/14396

Nambia, South Africa...all of Africa's plan to deal with shortages.  That's easy.  They go backwards in time and technology.  Can you imagine what will happen in western countries when this happens.  People can't deal with cell phone towers being out let alone the idea they'll hav to boil anything they feel like drinking.

 

http://www.npr.org/2012/04/20/150871935/as-workers-age-oil-industry-brac...

Then there is the skills shortage, which is really an issue split between age demographics and the fact the Oil industry is dangerous to work in.

 

http://www.guardian.co.tt/news/2012-04-20/farmers-protest-outside-pm%E2%...

This is happening now.  Water, Diesel and coal shortages worldwide are now at the levels that planting a crop doesn't mean you have the money to harvest it, plant it or water it.  Monstanto didn't do this.  Too many people did.  monsanto is just running a snake oil scam.  Their seeds grow just as well as normal seed do without water or energy to harvest.  They rot in the ground or never germinate.

 

Here we all are on the most complex infrastructure ever devised by mankind, explaining to one another how we don't believe in something runs out.  The situations and news out there should be proof enough for some, but most don't want to lose this new toy that has allowed distances to mean nothing, to communicate with one another.  We have a deep an unabiding fear that is now starting to surface in people that we don't get to keep any of it because of lies, amazing miscalculation and poor strategic planning.  As I've mentioned before...we don't have to wait for a revolution or a war because when it officially breaks, a bullet in the head will seem like a small kindness to counter the level of personal energy people will have to commit to.

 

How will you notice it happening in your country.  Like every other country I've been tracking it starts in one place.  Media.

 

TV/Radio stations go offline first.  They are the canary in the coalmine.  Not pump prices.  not food.  The indicator is media.  Thin margins for local broadcasters = no money for energy price increases versus the advertising contracts in place.  Not one of the countries in the rolling black out situation has a TV channel that runs for more than an hour a day.  Media is fully dependent on energy delivery, it is the first step in the many steps required to get to the point of being unable to make ice.

 

No ice, no food storage.  No long term stores.  Shrinking population.

 

We will drop to a population level where the current energy production "fits" but it will come with the cost of people, governments, economies and conveniences.

 

 

Sat, 04/21/2012 - 12:57 | Link to Comment Flakmeister
Flakmeister's picture

Wow... and I thought I was less than optimistic....

The West is in for a rude surprise....

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