Monday, May 9, 2011

Predict gasoline prices to fall by 50 cents by June 1

After a rise in price of 99 cents since January, petroleum marketers predict unleaded prices will fall by about 50 cents - just in time for summer vacation motor trips.

It is a historical pattern followed each year, regardless of what is happening on the international scene. Gasoline prices typically peak in the spring, then gradually fall away during the last weeks before deep summer, said Fred Rozell, the retail pricing director at the Oil Price Information Service.

The lower prices are part of a fall in commodities prices across the board, according to analysts.

Petroleum supplies remain constrained by turmoil in the Middle East and North Africa, oil specialists said. There is the possibility that conflict could cut production in Nigeria. Expanding economies like China and India continue to drive the growth in oil consumption.

“Nothing has changed, except psychology and taking profits,” Allen Sinai, chief global economist of Decision Economics, a consulting firm, said of this week’s selloff in the oil futures market. “This is a correction, and not a shift in trend.”

Light sweet crude, the benchmark of New York trading, fell below $100 on Thursday for the first time since March, but it remains almost 30 percent higher than a year ago. At the close on Friday, oil for June delivery was down $2.62 at $97.18 a barrel.

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