Gas prices in New Jersey have a lot in common with the plot of the movie Groundhog Day, where a weatherman played by Bill Murray relives Feb. 2.
That’s because prices keep trickling downward by a few cents a week, which is what was predicted by Tom Kloza, Oil Price Information Service global petroleum expert. But will President Donald Trump’s tough talk and sanctions against Iran change that?
The President followed through on his Tweet about putting “Iran on notice” for testing a ballistic missile with sanctions announced by the administration on Friday.
But these shouldn’t have the same effect on oil and gas prices as the 2006 Iranian sanctions did because they haven’t been enacted by other nations, Kloza said.
This cash price for regular at a Raceway off Route 1 in Woodbridge was in the $2.20 to $2.25 range that experts said is what most retailers are selling gas for, despite some discount prices that suggest $2 might return. Larry Higgs | NJ Advance Media for NJ.com
“The sanctions that were put in place on Iran that led to $90 to $100 a barrel oil prices were done with a lot of other countries and were very effective,” Kloza said. “It would take something unprecedented to stop the flow of oil. The rhetoric is bellicose, but it will keep crude oil where it is.”
Tempering any commodities market exuberance to push prices up is a high supply and low demand for gas which is running six percent below Feb. 2016, he said.
That’s sent prices down to a state average of $2.34 a gallon for regular on Friday, which landed at $2.33 on Monday, according to GasBuddy.com. Discounters has a range between $2.07 and $2.11 on Friday morning, but GasBuddy.Com reported that $2.07 price disappeared before noon, but returned over the weekend.
“Groundhog Day is the perfect metaphor, he looked out and saw a lot of gas,” Kloza said.
Does this mean that we’re flirting with $2 gas? Kloza said it’s doubtful because gas would be below cost. NASDAQ reported that wholesale gas was at $1.54 a gallon on the New York Mercantile Exchange on Friday and that doesn’t include transportation, taxes or other costs.
“We’re not tangoing with big (price) dips,” he said.
Larry Higgs may be reached at lhiggs@njadvancemedia.com. Follow him on Twitter @commutinglarry. Find NJ.com on Facebook.
Our editors found this article on this site using Google and regenerated it for our readers.
