CLARKONOMICS: Gas prices in the lowest-priced markets in the United States could dip below the $3 mark this summer thanks to a variety of world factors both political and practical.
Speaking politically, you have France’s election of a new socialist president; the disruption in the Greek elections; and continuing political uncertainty and economic calamity in Europe. All of which lead to a greater likelihood of deeper recessions across Europe, thereby reducing demand for oil and gas.
Not to mention that China’s economy is slowing down too!
Then from the domestic angle, you have Americans buying more fuel efficient vehicles and driving less. So today we are sitting with the greatest stockpile of oil in the U.S. in 22 years. Wow!
Plus, add in to the mix that things seem to have quieted down some with Iran in terms of our going to war with them over their nuclear ambitions, so that is an additional factor loosening up the oil supplies and going a long way to deal with the psychological side of the equation.
PREDICTION: How low can gas prices go? Nobody knows. It is a fool’s errand to try to predict…but I’ll be really foolish and say that we will see a better than 50/50 chance that this summer, prices will start at $2.XX per gallon in our lowest-cost markets.
Maybe it will only be $2.999, but I believe we’ll see up to a dollar a gallon drop from where we’ve been recently.