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Editorial
How will you spend your 'gasoline bonus'?
Monday, January 5, 2015
We've got good news and bad news.
First, the good news: the price of gasoline is down.
And the bad news? See above.
For most of us who depend on our cars and pickup trucks to get around, the fact that the average price of gasoline dropped for 99 consecutive days, as reported by AAA on Friday, that means more money in our pockets.
The oil industry, on the other hand, has less; crude oil prices are flirting with $50; smaller royalty checks to landowners and operators and fewer jobs in the oil patch.
Gas station owners, on the other hand, can lower prices and still squeeze a little more profit from the pump as prices drop.
The auto industry, after years of bulking up its fuel-efficient line of vehicles, is finding itself with a shortage of bigger SUVs, now in greater demand because of the lower fuel prices.
AAA estimates that Americans saved about $14 billion on gasoline in 2014, compared to 2013, an average of about $115 on gasoline compared to the previous year.
The annual average price of gasoline in 2014 was $3.34 per gallon, about 15 cents less than 2013 when fuel averaged $3.49 per gallon -- it was $3.60 in 2012, $3.51 in 2011 and $2.78 in 2010.
The highest daily average last year was $3.70 on April 28, while the lowest was $2.26 on Dec. 31, a savings of $1.44 a gallon, or $21.60 each time a motorist filled a vehicle with a 15-gallon tank.
With any luck, according to AAA, the national average price of gas may remain less than $3 a gallon in 2015, but crude oil prices are hard to predict.
While the market sees a global glut of crude oil and petroleum products because of increased North American production and lower than predicted international demand, OPEC recently announced it has no plans to reduce pumping.
Look for prices to climb again in the spring, when refineries shot down to switch to summer formulas -- unless oil prices continue to drop.
So should we all stop worrying about saving gasoline? No, but if you really need a bigger vehicle, by all means, go shop for one.
Otherwise, let's enjoy the "gasoline bonus" but putting some cash away for the rainy days -- and higher fuel prices -- that will inevitably come.