Tuesday, April 08, 2008

$4 a gallon

Here’s the government doing the advance work of the oil industry and preparing you for the blow that’s coming.
Retail gas prices could climb as high as $4 a gallon this summer, but prices at such lofty levels will make many Americans think twice about hitting the road this summer, the Energy Department said Tuesday.

High prices and a weak economy are expected to cut demand for gasoline by about 0.4 percent during the peak summer driving season, the department's Energy Information Administration said in a monthly report on petroleum supplies and demand. Overall consumption of petroleum products will drop by 90,000 barrels a day this year. Previously, the EIA had projected petroleum consumption would rise by 40,000 barrels a day.
The EIA predicts a drop in demand after it predicted a rise in demand. Yet both conditions somehow lead to higher prices. Isn’t that amazing?

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