Stephen Schork, editor of The Schork Report, told CNBC’s “Morning Call” that he expects gasoline prices to decline by summer to a nationwide average of about $2.70 a gallon.
He said gasoline supplies always decline at this time of year as refiners build their supply of crude oil to prepare for the summer driving season. The drop in gasoline supplies creates a temporary spike in prices.
“There’s nothing new here,” Schork said Wednesday. “Gasoline supplies draw down because refiners are now in the maintenance season. They are retooling and shutting down units so they can start the blend for summer-grade gasoline at the end of April.”
He said gasoline entered its usual pre-season rally about five weeks early this year.
“You’re seeing a lot of that angst that normally accompanies a pre-season market priced in now,” Schork said. “By the time we get to the summer...the gasoline will be there and the price will come down.”
Vincent DeVito, an attorney for Pepper Hamilton and former acting assistant secretary of energy, said oil is now a national security issue and the price now includes a “fear premium.”