Bob CollinsQuietly, the price of gas is heading toward painful levels, and the law of supply and demand is being tested.
In our last big oil price run-up, we heard the problem was the rapidly expanding economies of China and India are requiring more oil. The U.S. Energy Information Bureau notes demand for gasoline is actually dropping in the U.S., and yet the price is going up.
The price jumped almost 10 cents a gallon — to $2.75 at the big stores — on Tuesday, according to TwinCitiesGasPrices.com., about $1 a gallon higher than a year ago. Unlike the previous run-up, the Twin Cities exceeds the national average price of gasoline.
Today the government announced the amount of gasoline put into storage was triple what most analysts had forecast. It’s too cold for many people to drive, some analysts said.
“Between the API and the EIA numbers, this is not adding up to much of an argument for crude above $82 a barrel,” said Addison Armstrong at Tradition Energy in Connecticut.
