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Gas prices rise on volatility Oil futures are buffeted by global events
Gas prices are moving up as oil prices surged to a new record $89 per barrel on Wednesday but retreated later in the day after government data showed larger than expected gas and oil supplies.
A gallon of
regular was selling for an average of $2.824 in the Florida market, up a penny from the previous day.
Prices remain below their highs for the month, in the range of $2.86. In late September, prices were nearing $2.90 per
gallon.
It can take weeks for rises in oil prices to translate in gas prices. Generally, every $1 move in oil translates to a 2.5 cent increase at the pump.
Trading was volatile throughout the session on Wednesday
as oil futures were buffeted by a number of headlines, including news that Turkey's parliament approved a government plan to attack Kurdish rebels in northern Iraq and word of an explosion at a small refinery in Montana.
Reports by the Energy Department, the International Energy Agency and the Organization of Petroleum Exporting Countries over the past week have all supported a view that oil supplies are falling as demand is growing.
But
the Energy Department's inventory report countered those perceptions.
"Inventories are rising, not falling," said Tim Evans, an analyst at Citigroup Inc. in New York. "Demand is falling, not rising."
Light, sweet crude for November delivery fell 21 cents to settle at $87.40 a barrel on the Nymex. It was crude's first price decline in seven sessions.
The Energy Information Administration reported that crude
inventories rose by 1.8 million barrels during the week ended Oct. 12, more than the 1 million-barrel increase expected by many analysts.
Oil prices initially fell on that news, then reversed course and rose after the
Turkish parliament vote. Traders worry that any escalation in the conflict between the Kurds and Turkey will cut oil supplies from northern Iraq. Despite the decision, Turkey's government said a move into Iraq is not imminent.
http://www.worldenergynews.com/
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