Thursday, August 31, 2006

Yay

USA Today reports that gas prices will probably keep falling:

Gasoline prices are falling fast and could keep dropping for months.

"The only place they have to go is down," says Fred Rozell, gasoline analyst at the Oil Price Information Service (OPIS). "We'll be closer to $2 than $3 come Thanksgiving."

Since, you know, high prices were All Bush's Fault (tm), expect to see a plethora of articles rejoicing in his amazing feat of political economic fixin'. (Don't hold your breath).

Incidentally, I recommend proft-taking in oil stocks, particularly companies that are primarily downstream (i.e. heavily invested in refining). Downstream companies tend to get hit harder by the oil market boom-n'-bust cycle because they have to buy oil on the open market, unlike companies that find their own.

Good recent examples of this are Holly Corp. (HOC) and Alon USA Energy (ALJ).

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