The longer term trend has the retail price of gasoline in
the US going to $3.50 a gallon at some point in 2008. Some
industry experts speculate that such will happen this spring
during the seasonal bump in gasoline prices and reflecting the
need to add a costly additive called alkylate. The conversion from
MTBE to alkylate for summer driving was ordered in 2005, and
observers argue that the sharp spring spikes in the gasoline
price over the past three years relect the new additive which
spot trades 15 - 20% above gasoline. Refiners have added capacity
to crack out alkylate, but the spot market remains fairly large.
Industry gurus often are not any better than most in forecasting
fuels prices, so there's hardly any assurance this story will
hold up. But it is worth noting nonetheless, as another gasoline
price spike would be most unwelcome in an economy already being
suppressed by the rapid run-ups in petrol products over the past
year.
No comments:
Post a Comment