Alon USA Partners, LP (ALDW)

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Some are saying higher gas prices this year which means oil will have to go up and I think it will this summer.If Trump can stimulate the economy with jobs then consumption will have to go up, so for now we wait.


Gasoline prices will hit a three-year high in 2017, an industry monitor said Wednesday.

GasBuddy, in its Fuel Price Outlook 2017 said prices, which have fallen steadily since 2012, will climb as oil producing nations reduce supply.

In the Capital Region, prices are projected to peak in the range of $3.10 to $3.35 a gallon sometime in May or June, said Gregg Laskoski, senior petroleum analyst for GasBuddy.

Laskoski cautioned that "there's a lot of uncertainty because you have a lot of moving parts."

It's not clear, for example, how the election of Donald Trump might affect global markets.

"What that also means is Iran may not be able to produce the crude oil it was hoping to produce because there may be more sanction imposed," Laskoski said. The resulting dropoff may put upward pressure on crude prices. That, plus planned production cuts by other producers, including Russia and Saudi Arabia, could propel crude prices higher.

But Laskoski said if they go high enough, say $65 a barrel, for long enough, "a lot of the projects that were suspended, a lot of that fracking is going to get back up in full swing," boosting supply and lowering crude prices.

Another boost to supply could come from the Keystone oil pipeline, which Trump has supported.

"Even if it doesn't bring a single drop of Canadian crude to the U.S., it will still benefit Americans," Laskoski said. "The extra crude helps to put downward pressure on international oil prices."

While the price of crude is likely the primary driver of retail gasoline prices, other factors include refinery and pipeline outages, weather, political turmoil in producing nations, and the strength of the nation's economy.

Even a switch from winter-blend gasoline to the more expensive "summer blend" tends to boost prices as motorists enter the peak summer driving season.

In the Capital Region, the average price for a gallon of gasoline climbed more than 6 cents in the past week to $2.457 on Wednesday, according to the AAA Fuel Gauge report. It's up more than 16 cents in the past month and nearly 30 cents higher than a year ago.

But it's still well below its all-time high of $4.210, set on July 8, 2008.