NYMEX WTI oil prices continue to flirt with the $100 a barrel barrier, and actually breached it at $100.86 last Wednesday. Yet as the futures price of oil increased, gasoline prices have declined. Unfortunately, the probablility of additional decreases in retail gas prices is minimal if oil prices continue their upward trajectory.
What's more likely to happen is that the price of Brent Crude from the North Sea will continue to drop while the price of WTI (West Texas Intermediary) will continue to climb.
Normally the two oils sell at near parity, but recently the spread has been as much as $25 a barrel between U.S. WTI, and Great Britain's Brent. The reason is that there is a glut of oil at the Cushing terminal in Oklahoma. See our story explaining the glut here.
In the meantime, unless we see vertigo inducing drop in retail gas prices, it is very likely that December of 2011 will go on record as having the highest gas prices for any December in U.S. history.