ST. CLOUD, Minn. - A Minnesotan who's been watching the petroleum markets for decades believes gas prices could be in for a downward correction.
"This has been so wrong that a huge correction is definitely plausible and rational to expect," said Jim Feneis, CEO of First Fuel Banks in St. Cloud.
Feneis used the term "crazy" to describe the recent run-up in gasoline prices while crude oil prices have remained comparatively low.
Feneis cited a crude oil price of $93.10 on Jan. 8. On Monday, the same barrel of crude was selling for $92.14.
"Makes no sense, gasoline raised 87-and-three-quarter cents or 2.3 cents every calendar day for a consecutive 38 days," said Feneis, citing gasoline prices at the wholesale level.
Feneis follows the futures market closely for his business, but says historic predictors of future gas prices are no longer valid in a market so readily swayed by trader speculation.
Other experts have blamed maintenance shutdowns at refineries for gasoline price hikes, but Feneis believes that can only account for a portion of the run-up.
"The only thing that can be left is speculation," he said.
Though Feneis expects a significant correction in gasoline prices, he says all bets are off if a crisis erupts in the Middle East or some other factor disrupts the supply of oil.
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