Dr. Tom Seng: Fluctuating gas prices

ANCHOR
GAS PRICES ARE GOING DOWN… BUT STILL NEAR RECORD HIGHS… AS WE HEAD INTO THE FOURTH OF JULY WEEKEND.
THE NATIONAL AVERAGE IS NOW UNDER FOUR-DOLLARS A GALLON.

WE SPOKE WITH AN ENERGY EXPERT ABOUT THE ROAD AHEAD FOR DRIVERS.

AS DRIVERS HIT THE ROADS… THEY’RE STILL TAKING A HIT TO THEIR WALLETS.

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Super: Dr. Tom Seng – Professor, Texas Christian University
“The Iran War started at a bad time really for us as consumers because it preceded the summer. And so we’re at our highest demand for gasoline, for aviation fuel, for people traveling.”

THAT’S DOCTOR TOM SENG… AN ENERGY FINANCE PROFESSOR AT TEXAS CHRISTIAN UNIVERSITY.

BESIDES HIGH GAS PRICES… HE SAYS THE IRAN WAR HAS ALSO MADE THE MARKETPLACE MORE VOLATILE.

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Duration: :31
“Prices go up and down and they do so rapidly, and from my observations in the marketplace, a lot of this is directly tied to the statements that come out of the White House. If we were to graph prices on a particular day when Donald Trump sends something out where it’s kind of, let’s call it a threatening statement to Iran, oil prices go up. And then when he has a more conciliatory tone, we see that the market then feels better about supply and they sell it off and we see prices come down.”

AND IT’S NOT JUST PRICES WE PAY AT THE PUMP.

HE SAYS ENERGY COSTS ARE HIDDEN IN EVERDAY ITEMS… EVEN A LOAF OF BREAD.

THAT’S BECAUSE FARMERS USE DIESEL TRACTORS TO PLOW… PLANT… AND FERTILIZE CROPS.

DIESEL IS ALSO USED TO HARVEST AND TRANSPORT WHEAT TO THE MILL.

AND THE MILL USES ELECTRICITY TO GRIND THE WHEAT INTO FLOUR.

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Duration: :20
(Dr. Seng)
“And then last but not least, there’s a polyurethane bag that that bread is put into. And polyurethan is a derivative. It’s a petrochemical derived from natural gas or crude oil. So just that loaf of bread, the underlying costs of energy are a significant portion of the ultimate retail price.”

AS FOR WHAT WE CAN EXPECT IN THE COMING MONTHS… DOCTOR SENG SAYS PRICES ARE SLOWLY TRENDING DOWN.

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Duration: :13
“The good thing is we are confirming tankers of oil moving through the Strait of Hormuz, not back to pre-war levels, but just even knowing that there’s oil flowing through there, that’s supply that we do need.”

BUT HE SAYS DON’T EXPECT PRICES TO RETURN TO NORMAL OVERNIGHT.

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“It’s tough. And I hate that, I mean, I’m a consumer myself. I hate it that we do feel helpless. We don’t have control over the situation. We have to react to whatever the market hands us. And so right now, as I said, I’m optimistic about gasoline prices continuing to go lower to some level. We just have to be, we can’t take for granted energy. We have got to be efficient with the energy that we’re given, then we don’t find ourselves in these situations.”