For this week’s assignment, I chose to write about the ever changing and talked about oil and gas prices. Supply and demand are constantly shifting when it comes to this specific topic. As automobiles are evolving and being upgraded for fuel efficiency with every model, gas demand has shifted. Crude oil is down 6.1% from a 2013 settlement high of $ 97.94 in late January, according to wjs.com. Maybe paying for 5 to 8 thousand dollars more for a fuel efficient vehicle is actually working. According to wjs.com article “Crude Gets Left Out of Latest Rally,” “A combination of tepid global oil demand and steadily improving supply has taken the steam out of high oil prices and overshadowed otherwise bullish forces like the improving U.S. jobs market, traders and analysts said.” Stockpiles in the U.S. are up almost 6% since the start of 2013 and remain well above the five-year average. Regardless of the downward demand for crude oil, refiners are still shutting down to prepare summer grade fuel in expectance of the demand to shift higher. Interestingly enough, “the International Energy Association lowered its forecast for global oil demand growth by 85,000 barrels a day for 2013, attributing it to the financial crisis in Europe and slowing growth in Latin America.” (wjs.com) Will the demand shift once the summer months come? According to the article, it will as travelers prefer to drive than pay expensive rates for flights. Even though fuel is at an all-time low demand, the prices are still up there. If the demand has gone down for fuel, shouldn’t we expect some sort of decrease in price?
Crude Gets Left Out of Latest Rally. (2013, March 10). Retrieved from: “http://online.wsj.com/article/SB10001424127887324034804578348841329997224.html”