Gas at $4: A Subcompact Sweet Spot?

[Fuel Miser]

U.S. Gas Demand Falls for 5th Straight Week
NEW YORK -(Dow Jones)- U.S. demand for gasoline fell for the fifth straight week as pump prices continued to climb across the nation, according to a SpendingPulse report released Tuesday by MasterCard Advisors LLC, a division of MasterCard Inc. (MA).

Weekly gasoline demand averaged 9.188 million barrels a day for the week ended April 1, down 1.2% from the prior week. Meanwhile, retail gasoline prices are 28.9% higher than they were a year ago at $3.61 a gallon.

"As prices started to rise rapidly at the end of February, gasoline demand began to post year-over-year declines indicative of demand destruction," though some of the declines are offset by slight improvements in labor markets, said John Gamel, SpendingPulse analyst.

Prices have surged ahead of the key summer driving season, when gasoline consumption peaks in the U.S., and further gains "could begin to negatively impact demand in other retail and travel-related sectors as consumers begin to reduce discretionary spending," he said.

Four-week gasoline demand averaged 9.234 million barrels a day, the most since late December. But four-week demand dropped 1.4% from a year ago, the first time this average has declined for two consecutive weeks this year.

Gasoline consumption typically starts to grow in March and April because of the combination of warmer weather and spring break vacations.

However, demand is under pressure as prices stride toward record levels, Gamel said. "Gasoline prices at the pump continue to be driven by the volatile oil markets due to the ongoing crisis in the Middle East."

Demand figures in April are likely to be skewed by the timing of Easter, which will be celebrated three weeks later this year compared to last year, Gamel said. Last year, Easter Sunday fell on April 4; this year it will fall on April 24.

Nationwide, the average retail price of regular gasoline has hovered above $ 3.50 a gallon for four straight weeks and is at the highest level since October 2008. Prices have changed by more than 20% for seven weeks in a row based on year-over-year comparisons.

SpendingPulse is a macroeconomic indicator that reports on national retail sales and is based on aggregate sales activity in the MasterCard payments network, coupled with estimates for all other payment forms, including cash and check. SpendingPulse from MasterCard doesn't represent MasterCard financial performance.

The Department of Energy is scheduled to release its weekly petroleum data, including demand, at 10:30 a.m. EDT on Wednesday.

The data, put out by the DOE's Energy Information Administration statistics and analysis unit, doesn't count how many gallons are sold. Instead, it offers a "product supplied," or implied demand figure, in its weekly report. Product supplied represents the total volume of gasoline that has moved on from refineries, pipelines, blending plants and terminals on its way to supplying retail stations.

-By Naureen S. Malik, Dow Jones Newswires; 212-416-4210; naureen.malik@dowjones.com

http://www.nasdaq.com/aspx/stock-mar...-spendingpulse

[Fuel Miser]

National Average Gas Prices Rocket Toward $4 Per Gallon
Yesterday
NEW YORK -- With four weeks to go until the unofficial start of summer, and two months to the July Fourth holiday, many U.S. residents are planning their family vacations. However, this year they may not be going as far as they would like -- and gas prices may be too blame.

Just this past weekend gas prices ticked up 3 cents, and that has some predicting prices per gallon will hit the $4 mark at every station across the country this week, as CNNMoney reported. Gas currently averages more than $4 per gallon in 13 states and Washington, D.C.

"We're going to hit $4 this week, nationally," said Tom Kloza, chief analyst at the Oil Price Information Service. "There's momentum to take us there."

Gas prices continued their 45-day streak today, May 3, when the national average price for a gallon of regular gas hit $3.967, according to AAA. That is up from $3.952 on Monday and $3.943 on Sunday. Wyoming has the lowest price per gallon at $3.614. One year ago, the national average for a gallon of regular gas cost a motorist $2.895.

According to Kloza, this past weekend's price jump was a delayed response to deadly storms across the South last week that temporarily knocked out power at some oil refineries along the Gulf Coast, CNNMoney reported. Further compounding the problem, he added, refineries around the Great Lakes have been shut down recently for scheduled maintenance, which put pressure on gas prices across the Midwest.

The sharp rise in gas prices -- which surged 88 cents so far this year -- has been fueled by a rally in the price of crude oil as investors react to the combination of strong global energy demand, instability in the Middle East and a weak U.S. dollar, according to the news outlet.

But all is not grim. Traditionally, gas prices tick up in the weeks leading up to Memorial Day and back off after the three-day weekend. "I do think we'll backtrack from the peak, which we'll probably see sometime in the next two weeks," Kloza said, adding that it is unlikely that prices will hit $5 nationwide.

http://www.csnews.com/top-story-national_average_gas_prices_rocket_toward_$4_per_g allon-58632.html

[bowtieguy]

here's a great argument for buying used...http://autos.aol.com/gallery/Best-Us...backs-Under-5K

[bowtieguy]

and the new kia rio can shut itself off...http://www.cnbc.com/id/42702609/

[Fuel Miser]

Gas prices expected to drop 50 cents by summer
CHRIS KAHN, AP Energy Writer ? Sat May 7, 5:03 pm ET

NEW YORK ? Some relief from suffocating gas prices will likely arrive just in time for summer vacation. Expect a drop of nearly 50 cents as early as June, analysts say.

After rocketing up 91 cents since January, including 44 straight days of increases, the national average this past week stopped just shy of $4 a gallon and has retreated to under $3.98. A steady decline is expected to follow.

It might not be enough to evoke cheers from people who recall gas stations charging less than $3 a gallon last year. But it would still ease the burden on drivers. And it might help lift consumer spending, which powers about 70 percent of the economy. A 50-cent drop in prices would save U.S. drivers about $189 million a day.

Typically, gas prices peak each spring, then fall into a summertime swoon that can last several weeks. This year's decline should be gradual but steady, said Fred Rozell, the retail pricing director at the Oil Price Information Service.

Some drivers might not notice much of a price drop at first, Rozell cautioned. When average gas prices fluctuate nationally, some areas are affected more than others. In cities with many service stations, for instance, prices can be slower to fall. It's even possible prices will rise at some stations in coming days even if they decline nationally.

And after the galloping surge in prices this year, many gas station owners are reluctant to lower prices until they see their competition doing the same, Rozell said.

"It's just the nature of the business," he said. "They're going to try to get the most they can."

Station owners still feel bruised from their own higher costs earlier this year. In some cases, their suppliers raised prices so quickly that station owners couldn't pass along those higher costs to consumers fast enough. Competition also makes it hard for some stations to raise prices.

"So station owners will be watching each other this summer," Rozell said. "When one guy drops, so will the other."

A drop in prices would take some pressure off struggling consumers as well as businesses. As prices soared this year, surveys showed that motorists started to drive less. MasterCard SpendingPulse said this past week that it had recorded its sixth straight week of declining gasoline consumption.

That's a cautionary sign for the economy, because most drivers conserve fuel only after curbing spending on other discretionary items like furniture, computers and vacations.

Over the past month, gas prices have risen 36 cents a gallon in Columbus, Ohio, to $4.10. Steve Garrett has felt it. He's scrapped a summer trip to Myrtle Beach, Fla. And the bakery distribution center where he works has begun closing sites and laying off staff to save fuel on bread and pastry shipments.

If prices fall fast enough, Garrett, 43, said he may think about another vacation in August.

"But right now, I'm still just scared about the economy," he said. "I still might lose my job."

This past week, a confluence of factors stemmed the rise in gasoline prices.

Oil, which is used to make gasoline, tumbled 15 percent in price. Investors who were worried about rising oil supplies and falling gasoline demand in the United States helped drive down the price. Oil prices were also responding to a rising dollar. Oil is priced in dollars. So a stronger dollar makes oil less appealing to people buying with foreign currencies.

It was the largest weekly drop for oil in two and a half years. Some analysts predict that oil will keep falling in coming weeks ? from about $97 a barrel to about $80.

Many U.S. refineries also are expected to boost production after a series of unplanned shutdowns stemming from power outages and other problems. Those refineries would pump more gasoline to gas stations. And the increased supplies should push down prices.

"It's going to be $3.50 per gallon this summer," oil analyst Andrew Lipow said. "At the very least, you can expect prices to fall 40 cents or so over the next several months."

Thirteen states and Washington, D.C., have recorded average prices above $4 per gallon. Prices shot up much higher than that in Hawaii, Alaska and parts of Illinois.

The run-up persuaded U.S. Sen. Mark Begich of Alaska to ask residents to post photos of local pump prices because "the rest of the country doesn't understand" what it's like to live with gasoline above $4.20 per gallon.

In Illinois, florist Harry Schneider said he had to cut back on shipments from his Melrose Park shop just before Mother's Day. With Chicago-area gas prices averaging $4.45 a gallon, Schneider said he couldn't afford to deliver some arrangements.

"I need to make enough to cover the driver's wages, wear-and-tear on the vehicles and fuel," Schneider said. "I keep looking at my own bottom line and wonder, `How long do I want to keep losing money?'"

In San Francisco, some top officials have traded their city-owned SUVs for more fuel-efficient hybrid vehicles. Police Chief Greg Suhr said he and his command staff would switch to Ford Fusion Hybrids. Mayor Edwin Lee opted for the Fusion sedan, which gets an average mileage of 39 miles per gallon.

Elsewhere, some hotel chains are starting to offer discounts to help offset higher gasoline costs.

Those changes may need to stay in place for a while. Even if oil falls steeply in coming months, analysts note that world demand continues to rise. Lipow predicts that oil could return to about $110 a barrel by year's end.

If that happens, and if any major hurricanes this year disrupt refining operations later this year, expect gasoline prices to once again flirt with $4 a gallon.

"It all depends on the weather," Rozell said. "Trying to predict anything beyond 30 days is witchcraft.

http://www.suntimes.com/business/5243042-417/gas-prices-expected-to-drop-50-cents-by-summer.html

[Fuel Miser]

N.J. Lawmakers Target Gas Prices
Monday, May 9, 2011

CINNAMINSON, N.J. -- Drivers looking for the best deal on gas may receive an assist in the form of displays noting when gas stations charge different prices for cash and credit purchases.

Lawmakers are expected to take up a bill today that would require station owners to post signs alerting drivers to the different prices, according to the report. This would help drivers find the cheapest gas around based on how they plan to pay.

Last month, a CNN Money study found that American households spent an average of $368 and nearly 9 percent of their total income on gasoline in April.

http://www.csnews.com/top-story-n.j._lawmakers_target_gas_prices-58670.html

[bowtieguy]

Originally Posted by Fuel Miser

Last month, a CNN Money study found that American households spent an average of $368 and nearly 9 percent of their total income on gasoline in April.

considering experts advise total auto expenses to not exceed 15%, this is huge. consumers need to put more thought into not only what they purchase, in regard to vehicle choice, but also how much they finance...meaning new, used or pay cash outright.