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August 4, 2008
Gas Prices on a Downward Trend
The last 12 months of gas prices for Los Angeles | Chart via LosAngelesGasPrices.com
Over the past month, the average price of gas has taken a steady decline of about 40-cents per gallon, making the Los Angeles region's average price for regular unleaded cost $4:22, according to AAA.
The big question is if this is a short-term dip or a long-term dive. Oil took a "sharp drop" today to around $121 a barrel, according to LA Biz Observed.
The big news last Thursday night was that Exxon Mobil reported an $11.68 billion profit in 2nd quarter, which is the largest reported profit by any U.S. company ever. That all equals out to $1500 a second. And be that what it may, it's not from the high prices directly at the pump, rather, from when it pulls oil from the ground and sells it around the world per barrel, according to an ABC News report on TV.
The other companies with high profits reported are Shell ($11.5 billion), BP ($9.4 billion( and Conoco ($5.4 billion). 9.6 billion less miles are driven per month these days in the country, but if gas prices continue to go down, what does that mean for the recent upsurge in public transit use and other alternative methods?
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Oh great, gas is going to go back down to $3 a gallon and people are going to forget fuel economy and go back to buying SUV's.
Thrill.
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I say that happens when it gets to $4/gallon.
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Eh - it won't last. The underlying causes of the gas price spike haven't changed. Anyway, if you look at the graph, the overall trend is always up, up, up, even if there are short periods of declining prices.
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Starting to bug me when people drive by some service station and remark, "wow, gas is cheap here." We just keep getting played like suckers. If gas went up to 8 bucks next year and then dropped to 6 would we still say "wow, it's cheap?!?"
This is typical later summer dip in prices, look for it to skyrocket again if there are any severe hurricanes threatening the Gulf and/or around Labor Day.
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So we're back to where we were on June 1 ... Yay?
Watch this price keep dropping so come election day the GOP can come out and say, "look! we did something about gas prices!" Their friends got real paid in the past few months so why not let down the price a bit for a bit of 'psychological relief'?
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Marc, they already are.