The Atlantic notes that gasoline prices have fallen to their lowest levels in more than two years. Part of the decline is attributable to soft demand resulting from Americans buying more fuel-efficient cars and younger people driving less. But another part of the decline is due to the international market for diesel fuel. According to the article, demand for diesel is strong in Europe and Asia. But when you make diesel, you also make other petroleum products like gasoline. In trying to take advantage of high diesel prices abroad, refiners may be driving down gasoline prices in this country.
According to the Energy Information Administration, it is likely that gasoline prices will remain relatively low for some time. It has forecast that the U.S. annual average regular gasoline retail price will be $3.50 per gallon in 2013 and $3.39 per gallon in 2014, compared to $3.63 per gallon in 2012. On the other hand, the article notes that oil is getting harder to find and extract, requiring greater and greater investments of time, money, and energy. Thus, the current positive outlook is not necessarily indicative of a long-term trend.
