After a relentless two-month rise, gasoline prices have come down very modestly. The AAA Fuel Gauge report shows that the average price nationwide for a gallon of regular was $3.696 yesterday, down from $3.746 a week ago. The price is still above $3.90 in several states, including Alaska, California, Connecticut, Hawaii and New York.
Part of the reason for the drop is an erosion in the price of oil. West Texas Intermediate crude traded for nearly $100 in early February. The price is closer to $91 now.
The Wall Street Journal reports:
The labor market is adding jobs at a brisk clip and stock markets are setting records. But the oil market has been left out of the party.
Benchmark crude in the U.S. is down 6.1% from a 2013 settlement high of $97.94 in late January, while Europe's Brent crude is off 6.8% from its high of $118.90 for the year. During the same period, the Dow Jones Industrial Average is up more than 3%, signaling a recent breakdown in the on-again-off-again relationship between the two markets.
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. A stable supply cushion has also blunted the impact of possible political turmoil in Venezuela following the death of President Hugo Chávez.
Filed under: 24/7 Wall St. Wire, Oil & Gas Tagged: featured