Newspaper article The Record (Bergen County, NJ)

Wild Year for Prices at Pump Predicted

Newspaper article The Record (Bergen County, NJ)

Wild Year for Prices at Pump Predicted

Article excerpt

Get ready for another year of volatility in gasoline, with pump prices again rising and falling frequently over the next 12 months.

But even with wild swings, the average price -- barring a major supply disruption -- is likely to be about 10 cents a gallon less than in 2013, analysts at GasBuddy.com predict.

That would push the yearlong average to below $3.40 a gallon for the first time since 2010, when prices averaged $2.78.

But averages don't fully reflect the wide variations you can expect, from month to month, state to state, and even station to station within individual states, said Tom Kloza, chief oil analyst at GasBuddy.com, the Wall-based company that tracks pump prices.

Last year the North Jersey average was $3.41 a gallon, but that included a peak of $3.65 in February, followed by a drop to $3.31 eight weeks later, a rise to $3.63 by mid-July and a low of $3.11 by mid-November.

Expect more of the same in 2014, with prices increasing in the first quarter of the year to a high of $3.83 a gallon, before easing off.

"Volatility in the U.S. gasoline market is here to stay," Kloza said. "We see the potential for dramatic price spikes and equally dramatic price plunges."

Thanks to the shale oil boom in the United States and continued growth in Canadian oil sands, crude production has advanced to its highest level since 1989, and imports of all foreign crude look to continue to drift lower, he said.

At the same time, demand has not increased in six years and, although it could be up slightly this year (final numbers come out in February), it will probably not be much, thanks to an aging population that drives less and tougher mileage standards.

"With the shale oil boom just hitting its stride, the United States has heavy layers of insulation that should protect it from price spikes that could impact other continents," the GasBuddy report said.

But higher production, while reducing dependence on foreign supplies, also has raised interest in lobbying efforts to lift the de facto ban on exports of U.S. crude, the report said.

Proponents argue that the U.S. shale oil boom will be stunted if exports are not allowed, but critics charge that crude represents a natural resource and say that the U. …

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