(Graph Source: NASDAQ)
Tuesday, January 20, 2015 – 09:15 a.m.
The price of West Texas Intermediate Crude Oil is continuing on a downward trajectory.
It’s good news for the pocketbooks of Southern California driver’s.
The battle between U.S. Domestic producers, who have been increasing drilling and production on private land, and OPEC for market share has no end in sight. Late last week one analyst predicted the price per barrel would go into the low $30 range later this year. On Monday comes Iran, who says $25 per barrel is even in the realm of possibilities.
On Tuesday, the International Monetary Fund (IMF) cut its world economic forecast by 0.3 to 3.5%.
A fall that great could bring California regular grade unleaded gasoline prices below $1.75 per gallon. But let’s not forget that state refiners will soon begin to shift to production of the lower emission “Summer Blend” soon. A formula that will tack-on another roughly $0.25-0.35 per gallon.
The two-year old republican mantra of “Drill baby Drill!” to bring down gas prices seems to have worked for the time being.
The fall in oil and gas prices has also boosted consumer confidence, due to the fact that the savings to their wallets is climbing amounting to hundreds of dollars per month.
Now brace for calls to raise taxes on gas at the pump at the state and federal government level.