Posted By RichC on May 17, 2008
The fuel price discussions continue as I made small talk with clients throughout the week; Friday was no exception. Petroleum traded at an all time high to almost $127 per barrel in the morning on strong demand and there is very little evidence that we’ll see an additional supply come online this summer … or that demand will weaken. In fact, Goldman Sachs release a report that they believe crude will average $140 for the second half of 2008 and oil traders are betting that Chinese demand for diesel will push prices higher. (as are U.S. refiners — they see better margins in diesel) For most people, just looking at the diesel (or gasoline) verses CPI inflation graph from 1995 to 2008, it is obvious that we need to do some serious re-budgeting.