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Good News: The Worst Could Be Over For Gas Prices This Spring
Israel and Iran have engaged in open conflict. Ukrainian drones have routinely targeted Russian oil refineries. And OPEC continues to restrict oil production.
These frightening occurrences sparked concerns about $4 gas, harming the US economy and exacerbating inflation.
However, this has not occurred, at least yet. Gas prices in the United States have stopped growing and dropped temporarily recently.
The national average was $3.66 per gallon on Monday, down from $3.68 a week ago, according to AAA.
There is growing anticipation that gas prices will peak in the spring, if not the entire year.
Patrick De Haan, head of petroleum analysis at GasBuddy, predicts that drivers will find relief at the pump in the coming weeks.
“I’m hoping the worst is behind us,” De Haan told CNN. Unless something drastic happens, there are increasing odds the national average has hit the projected spring peak.”
Tom Kloza, worldwide head of energy analysis at the Oil Price Information Service, believes gas prices will fall in the coming weeks.
“Most of the worries from the year’s first half have been resolved. “I think we’re safe until hurricane season,” Kloza remarked.
‘Could have been far worse.’
Of course, none of this implies that gas costs are cheap. They were lower in April 2021 and spring 2020, when Covid-19 kept many Americans off the roadways.
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The Worst Could Be Over For Gas Prices This Spring
Nonetheless, a springtime peak of less than $3.70 a gallon would be a win for consumers, considering the real risk of significantly higher gas costs.
“It could have been much worse,” said Andy Lipow, owner of the consultancy firm Lipow Oil Associates.
According to AAA, drivers in just seven US states pay $4 or more per gallon for gas. All those states are in the Western part of the country, followed by California, where the average is $5.40 per gallon, up from $4.88 last year.
The national average is nowhere near the record increase above $5 per gallon in June 2022.
“It seems evident that this will not be a record-setting year. “Filling your tank will feel much more normal this year,” said De Haan.
Economic and political ramifications.
Officials in Washington would most certainly breathe a sigh of relief.
Rising gasoline costs earlier this year led to lower-than-expected inflation readings, casting uncertainty on when the Federal Reserve will be able to decrease interest rates.
A rise in petrol prices is the last thing President Joe Biden wants as he works to persuade voters of his economic message before November. According to a new CNN poll, Biden’s support rating for the economy is 34%, and for inflation, it is even lower (29%).
The Biden administration backed off plans to buy crude oil for the US Strategic Petroleum Reserve, an emergency oil stockpile, earlier this month, adding to White House concerns over petrol costs.
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Some economists expect gas prices to rise further.
Lipow believes the national average will reach $3.75 per gallon this year.
Still, that would be lower than last year’s top of $3.88 per gallon in September.
“I’m not expecting a spike in gasoline prices,” Lipow added.
There are several reasons why gas prices are now holding steady.
First, oil prices have stopped rising. On April 12, US crude oil nearly reached $88 per barrel as investors braced for Iran’s reprisal against Israel over a suspected attack on an Iranian diplomatic complex in Syria.
However, oil prices fell when Israel and its allies effectively averted the reprisal. For now, fears of a larger confrontation in the Middle East have subsided, albeit this might alter quickly. US crude fell below $83 a barrel on Monday.
There are other seasonal aspects to consider.
The transition to more expensive summer-grade gasoline at US refineries is now complete. Similarly, the reopening of refineries that had been closed for normal maintenance has aided gasoline supplies.
Record-breaking US crude output continues to increase the oil supply. All of that US oil, headed by the Permian Basin in West Texas and New Mexico, is countering OPEC+’s production cuts, which Saudi Arabia and Russia lead.
Meanwhile, gasoline demand has remained relatively low despite other indications that American consumers are spending rapidly.
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The Worst Could Be Over For Gas Prices This Spring
The hurricane season looms.
Gas prices are at risk of reaching a double peak. That’s what happened last year, when gas prices peaked in April, fell, and then returned late in the summer as excessive heat hampered US refineries.
“Weather can wreak havoc,” said Kloza, an OPIS analyst.
A major hurricane that destroys oil facilities along the US Gulf Coast is the greater risk.
Forecasters warn that the hurricane season (which normally begins on June 1) will be extremely active. Colorado State University predicts more hurricanes and named storms than ever before.
“Hurricane season is the next major hurdle,” Kloza stated.
SOURCE – (CNN)
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Canadian Man Arrested for TikTok Video That Threatened Trudeau
A TikTok video that went live earlier this week has led to a Toronto man facing charges of threatening Prime Minister Justin Trudeau and Deputy Prime Minister Chrystia Freeland. Andrew Marshall, 61, is facing two counts of uttering threats.
On Friday afternoon, the Ontario Court of Justice granted him bail with a surety and restrictions after the RCMP charged him on Wednesday.
Following Monday’s upload to TikTok, CBC Toronto conducted its own independent investigation of the video. Marshall vehemently opposes what he perceives as restrictions on free expression in Canada in it.
“I get them taken down all the time— I make videos — or all my comments, that are just simple comments,” Marsh says in the TikTok. “It’s just getting ridiculous, Marshall said.”
According to the CBC more and more people are threatening politicians. The commissioner of the RCMP has hinted that further measures may be necessary to ensure their safety.
In the TikTok video, Marshall explains in great detail how he would brutally assassinate Trudeau and Freeland “if it was up to him.”
Marshall attacks multiple groups throughout the roughly 11-minute TikTok video, including the media, Muslims, migrants, and the police who defend the government.
Among Marshall’s bail terms are the following: he must not communicate with Trudeau or Freeland; he must not use the internet to make social media posts or comments; he must not own any weapons; and he must not apply for a firearms permit.
During the bail hearing, the prosecution provided all of the evidence that is often not published.
Nate Jackson, Marshall’s attorney, stressed his client’s liberties and privileges as a Canadian in an email message.
“He has the right to freedom of speech, the right to reasonable bail and the right to a fair trial,” he said. “Having secured his release from custody, we will continue to defend Mr. Marshall’s Charter rights as his case proceeds.”
Neither Freeland’s nor the prime minister’s office would comment on the allegations, according to the CBC.
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Canada’s Unemployment Rate Hits its Highest Point Since 2017
As the job market remains dismal, the national unemployment rate in Canada has risen to its highest point since 2017. This has led some analysts to question whether the Bank of Canada should be reducing interest rates more quickly.
In spite of a net gain of 22,000 jobs, Statistics Canada reported on Friday that the unemployment rate increased to 6.6% from 6.4% the previous month. The rise was due to an uptick in part-time employment and a fall in full-time employment.
Outside of the pandemic years, the national unemployment rate has reached its highest position since May 2017, according to StatCan.
Rapid population expansion in Canada has increased the overall labour pool, but the country’s unemployment rate has persisted in rising.
The summer job market was especially tough for students, according to StatCan. Not including the pandemic, the unemployment rate among students going back to school in the autumn was 16.7 percent, which is the highest level since 2012.
Two days after the Bank of Canada dropped interest rates for the third time in a row, reducing borrowing costs to alleviate economic pressure, the most recent reading of the Canadian job market follows suit.
According to TD Bank economist Leslie Preston, who wrote a note on Friday, the central bank is “giving the OK” to keep dropping rates due to the bad August jobs report. Preston predicts two more quarter-point decreases at the remaining decisions this year.
According to CIBC senior economist Andrew Grantham, there are indications that the labour market is quickly contracting more than initially thought, since the unemployment rate is nearly two percentage points greater than the record low of 4.9% in June 2022.
“Due to this, we believe the Bank should be contemplating a quicker rate of reductions in order to bring interest rates to less restrictive levels,” he informed clients in a letter on Friday morning.
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US Job Growth Falls Short of Expectations: Economy Struggles Under High Interest Rates
Last month, job growth in the United States was weaker than predicted, prompting concerns that the world’s largest economy is beginning to struggle under the weight of increased interest rates.
The Labour Department said that employers added 142,000 jobs in August, which was less than the nearly 160,000 economists predicted. It also stated that job gains over the preceding two months were weaker than expected.
However, the jobless rate went down to 4.2%, down from 4.3% in July.
The report is one of the most important indicators of the US economy and arrives at a vital time, as voters consider presidential candidates for the November election and the US central bank contemplates its first interest rate decrease in four years.
Analysts said the latest statistics kept the Federal Reserve on pace for a rate drop at its meeting this month, but did little to answer worries about the trajectory of the US economy or how much of a cut it should make.
“There has rarely been such a make-or-break number; unfortunately, today’s jobs report does not completely resolve the recession debate,” said Seema Shah, chief global strategist at Principal Asset Management.
Soaring prices in 2022 caused the Federal Reserve to hike its key lending rate to 5.3%, a nearly 20-year high.
Faced with increased borrowing costs for homes, vehicles, and other debt, the economy has slowed, helping to alleviate pressures that were boosting inflation but exacerbating market concerns.
As inflation has fallen to 2.9% in July, the Fed is under pressure to decrease interest rates to prevent additional economic deceleration.
Although job increases in August fell short of expectations, they were greater than in July, when a slowdown aroused anxieties and triggered several days of stock market volatility.
Last month, construction and health-care firms hired the most, while manufacturing and retailers laid off employees.
Ms Shah stated that the data in Friday’s report was mixed, but provided enough concerning indicators that the Fed should make a larger cut.
“On balance, with inflation pressures subdued, there is no reason for the Fed not to err on the side of caution and frontload rate cuts,” she told reporters.
Others, however, felt the advances were just steady enough to warrant a 0.25 percentage point decrease, as markets had long projected – though this could signal more cuts than expected in the coming months.
Paul Ashworth, Capital Economics’ senior North America economist, predicted that the Fed’s decision will be “close run.”
“The labour market is clearly experiencing a marked slowdown,” he said, adding that the new statistics were “overall still consistent with an economy experiencing a soft landing rather than plummeting into recession”.
Concerns about the economy are a major issue in the US election.
According to polls, a majority of Americans feel the US is in a recession, despite healthy 2.5% growth last year.
Donald Trump has declared that the economy is headed for a “crash,” and his team instantly latched on the latest data to criticise Vice President Kamala Harris, publishing a press release titled “warning lights flash as Kamala’s economy continues to weaken.”
Democrats have defended their performance, claiming that the United States survived the pandemic and inflation better than many other countries.
They believe the slowdown is a sign that the economy is returning to a more sustainable rate of growth following the post-pandemic boom.
“Although hiring has slowed, the US job market continues to generate solid job gains and wage growth that is consistently beating inflation,” the White House Council of Economic Advisors stated in a blog.
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