Retail Gas Prices Refuse to Cooperate with High-Price Predictions

Here’s where the lowest prices were in Metro Cincinnati this evening.

I believe these prices are lower than they were in the month before Katrina hit.

This is in contrast to this prediction from just 10 days ago:

Q. What is the outlook for gasoline prices this year?

A. Unless something dramatic happens soon to lower oil prices — say, a sharp economic slowdown — analysts believe U.S. motorists could pay close to $3 a gallon for gasoline by the time summer rolls around.

Of course, any $3-a-gallon scenario is predicated on simultaneous supply-chain problems, an outcome analysts fear but executives say is unlikely. But concerns about everything from hurricanes to new clean-fuel specifications are, at the very least, going to keep the market on edge and retail prices elevated.

Motor fuels expert Tom Kloza of Wall, N.J.-based Oil Price Information Service said retail gasoline prices could rise by 50 cents over the first six months of the year and by an additional 25 cents if demand stays strong and any significant supply interruptions occur.

Of course it isn’t summer yet, but the prediction of a 50 cent rise over the first six months of the year looks pretty problematic, given that prices have dropped quite a bit since the first of the year (I couldn’t find an average price as of December 31, but I know prices were higher than they are now).