GASOLINE PRICES GASOLINE PRICES GASOLINE PRICES

An eight cent drop overnight in SoCal. Since the first big drop here on April 17th, gasoline has now dropped fifty seven cents per gallon. This is much bigger than the tax cut for us civilians, particularly those of us in the West and South who drive great distances each week. A 20 gallon fill up puts $10 in our pockets. For many of us this is a $100 per month refund. Watch retail sales on the next report show an explosion, particularly at high end retailers. Every driver in the U.S. benefits. Every city owned bus line strapped for cash is off the hook. The airlines are breathing again, if barely because the military is no longer sucking up millions of gallons per day on the war. (Caution here because of the exchange rate; a cheap dollar raises costs) Cab drivers and truck drivers will now have mucho dinero in their jeans. I have no idea why the smart guys haven't picked up on the enormity of this "rebate". Perhaps it is because they all use cabs and limos.

Will gasoline prices go much lower? Maybe ten cents in the futures market at the most. We have seen the move now. Retail prices moved higher than futures, mainly on anticipation of serious shortages that did not materialize. OPEC was nice to us during the war and I don't think we will encourage Iraq to stay out of OPEC, a natural alliance for them.