Tuesday, November 01, 2005

Energy Prices

Two recent populist rants have been making the rounds and both concern energy prices. Gasoline prices and natural gas prices are so high, these rants go, that the average consumer will be hard pressed to fill his tank and heat his home.

The following are some data on the central New Jersey market price for a gallon of premium gasoline:

Immediately after Katrina: $3.35 (When my station attendant asked if I was paying by cash or credit I said "bank loan." I heard nothing but crickets, which to me was evidence that he either had no sense of humor or couldn't speak English.)

One Week Ago: $2.80

Today: $2.53

It looks like the tank-filling fear mongering might be a little off. Well, what about the folks that will not be able to heat their homes because natural gas prices are going to be outrageously high?

( DJ ) 11/01 10:15AM DJ US Oil Sector Down On Decline In Gas Prices
By Lisa Sanders

NEW YORK (Dow Jones)--Another decline in natural-gas prices spilled over to the oil sector and sent stocks into an early slide Tuesday. Natural gas for December delivery, which lost 6.5% on Monday, picked up where it left off, falling 51.5 cents, or 4.2% (today), to $11.69 per million British thermal units...

...Warm weather forecasts are behind the drop in energy futures."

(END) Dow Jones Newswires
11-01-05 1015ET
Copyright (c) 2005 Dow Jones & Company, Inc

So, the wholesale price of natural gas in the futures market is down more than 10% in two days. I guess we should all calm down.


Blogger Georgfelis said...

Unless you have a bunch of gas purchased on Margin, in which case you just lost your shirt and need to sell. Which will depress the market more, making more Margin calls, making more sell orders... I hope. :)

PS: No, I don't buy on margin. I don't buy lottery tickets either, and they don't have a chance of bankrupting me in an afternoon.

Wednesday, May 10, 2006 12:29:00 PM  

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