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WASHINGTON, D.C. -- The national price of all grades of gasoline in the United States could average $2.30 per gallon for the summer driving season, and hit $2.40 per gallon during peak-demand periods, according to a forecast by The Abraham Energy Report.
"We are in the midst of synchronized global economic downturn with surplus oil production capacity, and a global overhang of refining capacity as the recession has cut oil demand across the globe," according to the latest edition of report.
"U.S. commercial stocks of crude oil and petroleum products are well above the upper boundary of the five-year average range for this time of year and close to the highest levels we have seen in nearly 20 years. In spite of a recent sharp drop, motor gasoline inventories are still plentiful, and at the upper boundary of the five-year average range as well."
Distillate fuel inventories are well above the upper boundary of the five-year moving average, the report noted, adding that in other parts of the world, inventories are generally high for this time of the year.
In examining oil prices for the summer season, the report called them "the most important determinant of the price of gasoline and other transport fuels in the short term."
In 2008, crude oil prices averaged $100 per barrel, but were $121 per barrel during the summer driving season from April through September. Crude oil prices dropped dramatically in the fall of 2008, and have since averaged $43.50 per barrel in the first quarter of 2009.
"Prices have risen slightly since then," the report noted, "and seem poised to average in the $50-$55 per barrel range during the summer driving season. Crude prices could tick upward in the latter part of the year, especially if signs of economic recovery become apparent. Even so, and in the absence of any unexpected destabilizing events, prices will likely average about $50 per barrel for 2009," the report concluded.
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