Energy Prices Cool Down
Thanks to rising US energy production and stagnant demand, this winter could be one of the cheapest in years for Americans to drive and to heat their homes.
Gasoline prices are nearing a six-year low with futures markets (a price which doesn't include taxes and other expenses) trading as low as $1.25 per gallon this week. Drivers are enjoying nearly $1.00 per gallon in savings this year due to cheap crude oil prices and a near-record glut of gasoline inventories nationwide.
Meanwhile, natural gas prices are at a three-year low, another factor that should help consumers save money in the coming months. Half of all U.S. homes use natural gas for heating and the price drop of 35% over the last year could leave millions of Americans with extra spending money this winter.
Longer term, these low prices may not last as producers cut back on new projects, and low prices stimulate new demand from consumers and investors looking to cash in on recent discounts.
As of midday Friday, November gasoline traded for $1.31 per gallon, while November natural gas was worth $2.30 per million BTUs.
Cattle are Jumping
Bargain prices for beef at the wholesale level recently stimulated retailers to feature beef at attractive prices and finally caused a zoom upward for live cattle futures. Since last Monday, cattle for December delivery gained 6 cents per pound and held most of those gains towards this week's end.
Strong export demand and optimism regarding the U.S. economy added more support. This week's rising stock index futures, such as the Dow Jones and the S&P 500, encouraged even more buying proving the adage that "stocks and steak move in tandem."
Consumers may remain in the driver's seat for a while as the amount of frozen red meat in storage has now hit a record high since the numbers have been tracked, starting in 1916, at over 1.2 billion pounds. Abundant pork and chicken supplies may create alternatives too, as shoppers should have no problem stocking their own freezers at affordable prices.
Posting a comment requires free registration:
- If you already have an account, follow this link to login
- Otherwise, follow this link to register