It looks like we're in for higher prices at the pump ahead. And it's not just gasoline prices, but heating oil prices are set to rise as well.
Gasoline futures extended their rally Friday, raising the prospect that prices at the pump will reverse course and again head higher in the coming weeks. Oil futures moved above $68 a barrel. Retail gasoline prices, which typically lag the futures market, fell again by 1.4 cents overnight to a national average price of $3.029 a gallon, according to AAA and the Oil Price Information Service. Prices peaked at $3.227 a gallon on May 24.
"Unfortunately, I think this is about as good as it gets," said Tom Kloza, publisher and chief oil analyst at the Oil Price Information Service.
That's because gasoline futures have risen sharply in the wake of a government report on Wednesday that shocked traders by showing gasoline inventories remained flat as refineries used less of their capacity than they had the week before.
Also boosting prices on Friday was a lower-than-expected core inflation figure, which encouraged investors to move money from fixed income investments to commodities.
Gasoline for July jumped 4.42 cents to $2.2689 a gallon on the New York Mercantile Exchange. Light, sweet crude rose 52 cents to $68.17 a barrel in midday trading. Brent crude for August delivery rose 29 cents to $74.12 a barrel on London's ICE Futures exchange.
Also on the Nymex, heating oil futures rose less than a penny to $2.02 a gallon while natural gas prices added 17.1 cents to $7.979 per 1,000 cubic feet.
The inflation signs are starting to flash yellow...
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