Have you noticed lower gasoline prices lately? How low will they go, and how long will they stay down? Let's use SAS to analyze some of the data!...
First, let's look at just the price of gasoline over time. Here's a plot of the US average gasoline price, each week since year 2000. I use a very tiny bar (needle) to represent the price of each week, and change to a darker color at each 50-cent price increase. Notice that (in general) the price drops every year in the fall, and stays lower through the winter. Perhaps this is because people travel less, and there is less demand(?) What other factors do you think cause the price drop each fall?
Gasoline if made from oil, and of course the price of gasoline is very related to the price of oil. Saudi Arabia recently hinted that the price of oil might be going down to $80/barrel. I created two graphs where I plot the price of oil and gasoline, so you can visually compare them side-by-side.
The above two graphs definitely seem to indicate there's a correlation, but I wanted a way to visualize this correlation a bit more directly. Therefore I created a scatter plot with the price of oil on one axis and the price of gasoline on the other, and let SAS calculate a regression line through the data. The data points follow the line fairly closely.
Enough about graphs & analytics ... what's the lowest price you've paid for gasoline this fall? How low do you think the price will go, and how long will the price stay down? (Leave your reply in a comment!)