Oil prices dropped below $90 Tuesday after climbing to a 26-month high, but Oklahoma gasoline prices continue to rise.
The state's pump prices have risen by 14 cents a gallon on average over the past month, AAA Oklahoma spokesman Chuck Mai said.
AAA's gasoline price tracking website, FuelGaugeReport.com, showed the average price for gasoline Tuesday in Oklahoma was $2.909, up from $2.767 a month ago. Tuesday's national average was $3.073, 13 cents higher than last month.
“Although crude oil is down in price (Tuesday), these retail pump prices are reflective of what crude has done lately, and that's to rise,” Mai said. “The market really seems to lack direction, responding instead to every new headline and economic forecast that comes along.
“(Tuesday's) prices seem to be a function of strong inventories, a steady dollar and a decline in manufacturing activity in China.”
As oil prices dipped, analysts wondered whether the price of crude had climbed too high, too fast.
Benchmark oil for February lost $2.35 — more than 2 percent — to settle at $89.20 a barrel on the New York Mercantile Exchange after hitting $92.07 a barrel earlier in the day. It last settled above $92 on Oct. 3, 2008, when it reached $93.88.
After weeks of mostly positive global economic news, the price of oil has risen over the past month from about $88 a barrel.
“Everybody has been so bullish on 2011 … the mentality has just been buy it, buy it, buy it,” said Tom Bentz, analyst at BNP Paribas Commodity Futures. “The question everyone has is how much further do we have to go before we start stunting the economic recovery.”
Tradition Energy analyst Gene McGillian said he believes momentum will continue to carry oil prices toward a range of $95 to $100 a barrel.
“What you're starting to see is that we might have gotten a bit overextended, so more vulnerable to profit taking,” he said.
McGillian believes traders will closely watch markets for consumer sentiment cues.
Wall Street was mixed on Tuesday after stocks rallied Monday to open the trading year. The Dow Jones industrial average was up more than 20 points. The Nasdaq and the S&P 500 closed were a little lower.
A stronger dollar pushed down oil and other energy prices. Commodities such as oil, which are priced in dollars, become more expensive and less appealing to buyers using other currencies when the dollar rises.
In other Nymex trading in January contracts, heating oil fell 4.63 cents to settle at $2.5065 a gallon and gasoline lost 1.33 cents to settle at $2.4140 per gallon. February natural gas lost 1.9 cents to settle at $4.650 per 1,000 cubic feet.
