– by a New Deal Democrat
I plan to release an update on the Coronavirus later today because there have been several significant developments (No, the pandemic is *NOT* over), especially as it relates to the next few months. We’ll get our first batch of monthly housing data tomorrow and Wednesday. In the meantime, let’s update today on the energy price situation.
And here the news is unequivocally good. Oil prices as of this morning are below $83/barrel. They have remained below $90/barrel for the entire month. More importantly, if you follow the dotted line on the graph below all the way to the left, you can see that oil prices are now *lower* than they were before Russia invaded Ukraine:
They are still higher than they were a year ago, when the price of oil was around $70/barrel, but that created and will continue to create a second wind for American consumers.
Gas prices, which lag oil prices by 2 or 3 weeks, are down to an average of $3.64/gallon, only about 5% higher than they were before the invasion of Ukraine:
It is very likely that gas prices will drop to $3.45 or less in the next few weeks, again completely reversing their Ukraine war spike.
Note that I am not making predictions about the future course of oil prices. This is only a current forecast. But the immediate outlook for gas prices is very good.
There has been a flurry of positive coinciding economic data over the past month or two, and we can expect that to continue as gas prices continue to fall. We’re only 12 days away from the end of Q3, and DOOOMers hoping for a third straight GDP decline are probably out of luck.