Two Years Ago Gas Was $4.15 a Gallon ...

Posted by: Howard Silverblatt on June 28, 2010

Two years ago gasoline beat out milk for the race to $4 a gallon. Gas now sells for $2.80 a gallon (milk is still over $4), and the point-to-point decline only tells part of the volatility, and very little of its future. However, pending the impact of several issues, such as a stabilizing Euro on the dollar (which oil is still priced in) or the Gulf oil situation (not to mention the impending storm), a few stats on the rapidly approaching $80 barrel will have to do.

The S&P 500 is off 15.88% since 6/30/2008, ex Energy the decline would have been 10.39%
Energy is off 39.8% over the two years, the worst performing sector in the index
The market value change in Energy (market plus index changes) accounts for over half the decline since June of 2008; from 2007 solidly belongs to financials
Energy is 10.76% of the S&P 500 market value, in June,’08 it was 16.22%
Energy is now 12-13% of Operating Earnings, two years ago it was 23-25%, and in Q3,’09 it was 41%

See the attached file for details
2 years ago Gas was $4.15 a gallon.doc