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Fuel Prices Could Be in For Even Sharper Decline

Petroleum at $20 a barrel forecast, Pump prices could dip toward $1 a gallon.

by on Dec.09, 2015

A variety of factors, including the current El Nino, could drive the price of gas to just above $1 a gallon in the months ahead.

Fuel prices have tumbled to their lowest levels since 2007 in recent days, with much of the country now paying less than $2 a gallon – but if some new forecasts are correct, motorists might soon see figures plunging to little more than $1 a gallon.

Gasoline futures fell to near seven-year lows in New York trading this week, and with traders racing to sell of their holdings in crude oil, some observers are worried that the price of a barrel could tumble to half of the $40 to $45 figure seen in recent days.

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A variety of factors are at work, among them a glut of oil production, the decision by OPEC not to enact new production caps, and even the effects of El Nino, a warming of the Pacific Ocean expected to result in warmer temperatures in the U.S. – and thus, lower need for heating oil. (more…)