If you’ve filled up your gas tank lately, you might have noticed it was a bit less painful than usual. With the average price of gas in Indiana down to $3.40, now might seem like the best time to stock up on gas – but Don Good of the Good Oil Company says prices could very well continue to decrease.
Good explained that prices have lately been driven more by the world and US economies than by supply and demand, which is why gas prices have been dropping this summer rather than rising alongside the temperature. He says that for the last six months, supply has been very good, and when looking at the world forecast for economy and fuel demand, the demand for fuel has been decreased.
Good says that another condition driving the price of gas is events unfolding overseas.
“That’s really driving the thing, is the European crisis and the Chinese economy falling down. They’re looking at kinda spooking the people out of those markets, so that’s what’s driving it now,” Good explained. “The speculators are sitting on the sidelines, parking their money into safe investments, and we’re gonna reap the benefits of it.”
Good says the fact that the price of gas has been dropping in the summer is a big indication of how disconnected the price of fuel is from actual supply and demand. Good predicts that prices should stay down throughout the summer, but issues down in the Gulf of Mexico have caused a number of oil rigs to close down as a precaution with tropical storms.
“It would not surprise me to see things firm up a little bit over the next couple weeks while that plays out, but once that’s through and they open those rigs back up, I think we’re going to see it continue to slide a little bit,” he said.