Good news for the consumer and lower input costs for businesses both represent good news on the price front and for future U.S. economic growth, since consumer spending accounts for a huge two thirds of our economy.
Oil Glut Ignites Gasoline Price Swoon is subtitled 'Markets are Signaling That More Relief at Pump May Be on the Way' and tells the good news story:
"Gasoline prices have tumbled from highs hit in June. And markets are signaling that consumers will get even more relief at the pump.
A global glut of crude oil is the main driver behind the decline in gasoline. Relatively cheap oil has made it more profitable for refiners to produce gasoline and other fuels, and they have ramped up production to record levels.
This boom in supplies has sent gasoline prices tumbling. Traders and other market observers expect the flow of both crude oil and gasoline to keep rising, likely exerting more downward pressure on prices.
The average retail price for a gallon of regular gasoline was $3.42 on Thursday, down 3.8% from the same period in 2013, according to motor club AAA. For this time of year, gasoline prices are at their lowest level in four years.
"We certainly have plenty of crude-oil supply over the next couple of months and plenty of products," said Andy Lipow, president of consulting firm Lipow Oil Associates in Houston. "I'm expecting the national average to drop to $3.15 by Halloween, and $3 a gallon as a national average is certainly in the cards." Analysts at AAA predict prices could fall another 15 to 20 cents by the end of October.
Retail gasoline prices often fall as summer vacation winds down, but the speed and size of the recent decline underscore shifts in energy markets that many analysts expect to be lasting. U.S. gasoline output climbed above 10 million barrels a day for the first time on record in late April, according to the Energy Information Administration, and held above that level in 11 of the 19 weeks since then. . . .
Gasoline has declined 19% from its 52-week high hit in June and is off 9.3% this month. . . .
The per-barrel price of U.S. oil is about $5 less than the global Brent benchmark, because new technologies to access supplies trapped in shale-oil fields have boosted U.S. crude output to the highest level in decades.
The price gap allows refiners to sell petroleum products abroad at lower prices than their competitors outside the U.S. Also, the type of crude oil produced from shale-oil fields yields more gasoline in the refining process than other types of oil. . . .
To be sure, tensions in the Middle East could cause oil prices to spike as they did in June when Islamist militants swept through northern Iraq. On Wednesday, President Barack Obama authorized airstrikes in Syria and expanded a bombing campaign in Iraq. Higher oil prices could discourage refiners from producing as much gasoline, which would constrain fuel supplies and support prices, some analysts said. . . .
Retail gasoline prices have held in a range of between about $3.25 and $4 a gallon in the past three years, said Kevin Logan, chief U.S. economist at HSBC. The national average hasn't fallen below $3 a gallon since December 2010, when a weak U.S. economy prompted a cutback in driving."
There's not much good news in the world or our U.S. economy to celebrate these days.
So let's take a short pause from all the bad stuff out there to enjoy what we can while we can --- lower energy costs.
And let's realize as well that government approval of the Keystone Pipeline's construction and allowance of more energy drilling and exploration in the U.S. would greatly help alleviate the current dependency we have on unpredictable non-allies such as Russia, OPEC and Venezuela.
That's just another reason why politics sucks, and why We the People need to take charge.
That's my take.