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Opinion * Canada - Diesel's wild ride
After 38% slide, prices are cheaper than gas again as weak economy shrinks demand for fuel
Toronto,ONT,CAN -The Toronto Star, by Tyler Hamilton -Jun 22, 2009: -- Looking for signs of economic recovery? Just ask a trucking firm... The trucking sector is a barometer of economic health. When the economy is thriving, manufacturers and retailers are shipping more goods overland. When it suffers, 18-wheelers are parked and their engines idled... Money has poured into oil markets recently as the U.S. dollar fell against the euro. Investors for months have used crude as a hedge against inflation, betting that oil prices will likely increase as the economy improves and global supplies start to shrink... But reality is beginning to set in, at least when it comes to the U.S. economy. The U.S. Department of Energy reported yesterday that gasoline inventories rose 3.39 million barrels to 205 million last week, the largest jump since January. Daily demand for fuels is 6 per cent lower than a year ago... This means pump prices will likely stay at current levels through the Canada Day and Fourth of July weekends. "Gas prices should back off a bit after that,'' said Phil Flynn, an analyst at Alaron Trading Corp... Diesel prices may follow... As long as economic activity remains down, diesel is expected to sell at a big discount compared with gasoline, at least until trucking firms like J.D. Smith start pumping more... (Photo by ANDREAS GRADIN / SHUTTERSTOCK)Labels: diesel fuel
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