Carol Thorp Oil Quotations

Wholesale gasoline prices have dropped across the country and West Coast gasoline inventory is strong. That actually led to a slight decline in pump prices in the last few days, although overall averages are still higher than at this time last week. However, oil industry analysts expect wholesale prices to start heading up again once the more expensive summer-grade fuel starts going on the market at the end of February.

The speculators on the market are pushing the price up - they're worried about oil coming from Iraq, they're worried about what Iran could do to affect the price, they're worried about labor unrest in Nigeria.

The month-to-month gas price hike was driven primarily by increasing oil prices and speculation over adequate production. Higher gasoline and oil inventories have eased these concerns. However, when gas stations begin to sell the more expensive summer blend fuel in March, prices may start to increase again.

The relationship between supply and demand is relatively balanced in California, so normally we should see stable prices. However, speculators in oil and gasoline markets have kept prices high, and that has filtered down to local gas pumps. The trend for higher gas prices is expected to continue for the next several weeks.

Investors have been climbing a wall of worry because of uncertainties about political stability in Iraq and saber-rattling in Iran. Those worries have sent crude oil futures to record levels and gasoline has followed.

Californians use 2 million gallons more of fuel every day than we produce in the state. Oil companies have to buy gas from other sources just to keep even with demand. If every motorist were to save two gallons every week, that would put our demand more in line with our state production.

Gas prices in most areas began heading back up on Monday after dropping for about three weeks. Traditionally, Southern California has experienced gas price spikes during the spring, and oil industry analysts believe this could be the beginning of another one.

Gas prices dropped at a slightly slower pace than the prior week, which can be attributed to level crude oil prices and the increased demand over the holiday weekend. However, analysts tell us there is still some room for prices to drop in the coming weeks.