The Federal Reserve's September 21 announcement of Quantitative Easing, that effectively hiked the price of crude by weakening the dollar, is now expected [image-nocss] to be even more severe because of another bad employment report. This took crude oil up another notch; it closed at nearly $83 per barrel on October 8.
The recent retail price increase puts gasoline 29.41 cents higher than one year ago. Retail diesel consumers are paying a whopping 44.39 cents more than a year ago. Retail diesel rose 9.87 cents in the past two weeks to $3.0939 per gallon. The prices of both products are being forced up by the propped up price of crude.
Retail gasoline margin took a hit of more than a nickel since September 24 (it is currently an unrealistic 7.87 cents on regular), as the U.S. wholesale price weighted by the classes of trade surged nearly 14 cents. If crude does not retreat from its lofty perch, margin recovery should soon hike the retail price another nickel or more.
Gasoline and diesel prices want to drop because of oversupply and weak demand, but can't. It is unfortunate that a federal policy in the name of helping the public has an effect of penalizing them at the pump.
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