Gasoline prices rose to a five-month high this week, gaining more than twenty-five cents per gallon. Nationwide, gasoline stockpiles are relatively low, nearly fifteen percent smaller than at this time last year. Ongoing turmoil in the Middle East has continued to keep prices elevated, but this week's biggest move came on the heels of a refinery explosion. Although gasoline production is not expected to be impacted by the event, news of the possible shutdown caused a wave of buying, pushing prices twelve cents higher on Thursday alone.
The price for wholesale gasoline for delivery in October, which excludes taxes and other expenses, was at $3.21 on Friday morning. Longer-term, consumers may see some relief, as wholesale prices for December delivery are nearly 40 cents lower.
Corn Pops on USDA Report
Corn prices climbed as much as forty cents per bushel in the wake of a USDA report that showed smaller-than-expected stockpiles of corn. Market participants had been anticipating that the United States had over 1.1 billion bushels of corn in storage before this fall's harvest began, but the USDA surprised the market with a sharply lower figure of only 985 million bushels. As a result of the smaller corn supply, prices rallied to $7.56 ¼ on Friday morning, the maximum price allowed that day by the Chicago Board of Trade. Next week, follow-through buying may continue, but traders will likely refocus on harvest progress and weather in South America, where farmers are currently planting corn.
Euro Slides on Budget Tensions
The European currency fell this week as protests in Spain and Greece turned violent. Both nations are currently trying to implement budget cuts in order to control their current debt crisis. Public resistance to these plans has investors concerned that Greece and Spain will not be able to control rising debts. As a result, investors sold European assets, pushing the price of the euro currency lower. As of midday Friday, the euro was worth $1.286, down 1.4 cents (-1.1%) on the week.