‘Skyrocketing’ gas prices nothing but fumes

GASOLINE prices

have not “skyrocketed.” And they are not going to skyrocket — at least that’s the prediction of the US government agency in charge of predicting such things. The price of gas is likely as high now as it is going to be anytime for the rest of this year. This is starting to annoy me. As I drive around New Jersey, I see the price of gasoline falling — not rising, much less skyrocketing. And this is happening during the summer when motorists are driving more, gas should be more in demand and it would be normal for prices to rise.

But I’m not hearing or reading about the falling prices. Most of the media seems to have bought into the skyrocketing gas price theme and it keeps repeating that falsehood.

Not only that, but also Americans are supposed to be up in arms. Well, we may be irked about some things but gas prices aren’t one of them.

Take what the chairman of the Democratic National Committee, Tom Perez, who used to be head of the Labor Department, had to say on this issue on Friday: “With slow wage growth, rising health care premiums and skyrocketing gas prices across the country, Donald Trump’s reckless policies are hurting millions of hardworking families.”

Perez was reacting to the Labor Department’s report that 213,000 jobs were created in June — before he went off on a gas price tangent.

Even President Trump seems worried about rising gas prices. He’s been pestering the Saudis to raise oil production so that prices won’t skyrocket.

Let’s concentrate on the “skyrocketing gas prices” part of Perez’s statement because I want to set the record straight with some facts.

The latest figures from the US Energy Information Administration show that gas prices averaged $2.84 a gallon across the US on July 2. Not cheap, for sure, but down from $2.94 a month earlier.

Here’s some perspective: For the week of May 7, the price of a gallon of gasoline was $2.85.

Prices are higher now, for sure, than they were in the spring when gas was about 10 cents to 20 cents lower. And gas was $1 a gallon lower in the winter of 2016.

But you have to put the phrase “skyrocketing” in a larger perspective. Back in 2014 — when the economy was weaker than it is today and gasoline demand should have been muted — prices averaged as high as $3.69 a gallon.

Much of today’s price increase is the result of turmoil in the oil markets. When the price of oil rises — as it has recently — speculators on Wall Street push up the price of all energy products, including gasoline.

What does the Energy Information Administration have to say about the future price of gasoline? It’s not predicting a “skyrocket” or any rise at all.

The EIA thinks gas prices will average $2.87 a gallon this summer. But it’s predicting a drop of more than a 20 cents a gallon Dec. 31.

You won’t be able to describe that as a “plunge” any more than you can describe what is happening now as a “skyrocket.” And there are some things that can interfere with that prediction, mostly a further disruption in the flow of oil somewhere in the world.

On the other hand, oil production could increase either because US producers go great guns or foreign crude supplies decide they need to produce more to earn more. And the price of gas could drop even more than expected.

Say what you want about gasoline prices — just don’t say they are skyrocketing. That annoys me.

There are some other things that don’t pass the smell test — and I’m not just talking about your kid after gym class.

One of them is the stock market rising despite the fact that the trade war between the US and China has been heating up.

Stocks had a nice run last week and were up sharply again on Monday, with the Dow Jones industrial average rising 320 points, to 24,776.

But it makes little sense that Wall Street was able to brush off the fact that stiff tariffs that were put in place against Chinese goods — and US goods, when Beijing retaliated.

There are several explanations for the way the market reacted.

One is that Wall Street just doesn’t care if the US and China beat in each others’ economic brains. Another is that traders see the trade war for what it really is: President Trump’s ego getting the better of common sense.

Or, maybe Wall Street knows that excellent corporate profit reports will start coming out this week and panic over the tariffs can wait. Those corporate profit reports might, in fact, mention the harmful effects that the trade tiff will have in the future, and that might warrant Wall Street’s attention.

Or the stock market may simply be going higher because it’s the middle of the summer and aggressive traders can often make it do whatever they want when the bulk of their colleagues are at the beach.

Speaking of the trade war, does anyone else think it is curious — and a little too coincidental — that North Korea is acting up again at the same time that its puppet master, China, is in a trade dispute with the US? President Trump might be trying to be too clever by working all these international angles at the same time. When Trump was making nice with China, North Korea behaved. Now that the trade war is up and running, North Korea suddenly is giving the US a hard time again. Curious, but pretty predictable.