Crude Oil Continues to Fall, What Does It Mean?

Crude oil prices have fallen over $10 a barrel over the last 7 weeks and that means good news to all end consumers.

Why is this happening and what should we expect in the coming weeks?

The Why’s?

• Geo Political tension seems to be quite for right now. That can change by the time I finish this article but for the last few weeks, no news is good news and no news means lower crude oil prices
• U.S. dollar believe it or not has been strong against the Euro. Since crude oil is traded in U.S. dollars this means you can buy more for your money with a strong dollar.
• Crude Oil is down $10 a barrel in the last 7 weeks. Typically for each dollar the price of crude oil falls, diesel fuel prices fall 2-3 cents a gallon and gas price fall similar.
• There has been a lack of demand for crude oil and finish product like diesel fuel and gas.
• The lack of demand has made a huge increase with inventory for all products. Great news for end users again.

Remember this lower crude oil produces, lower diesel fuel prices, gas price, tire costs, oil and lubes, chap stick because if it has petroleum in it since crude oil is going lower so will these products.

What To Expect!

• Crude oil should fall to less than $90 a barrel by the end of the year and has a remote shot at going as low as $85 a barrel
• That is roughly $6-$11 a barrel lower than it stands today. That kind of drop in crude oil, could equal a drop of 12-33 cents in diesel fuel and gas prices. Could you say DOE national diesel fuel prices of $3.60 by January 1. Gas prices in most states under $3.00. Wow! What a New Year!

That is all we have today. Of course this can all change with a few things happening.