Gasoline prices likely to sink

Gasoline prices, already more than 60 cents a gallon cheaper than mid-summer's $4-plus, could fall well below $3 a gallon within six weeks, experts believe.

"Prices can go anywhere; it all depends how bad things get," said Don Bowers, who manages Ross-based Superior Petroleum Co.'s gasoline business. "If it gets real bad, we could see gasoline between $2 and $3 a gallon within four to six weeks."

"I believe that $3 a gallon or less at the pump will be a common price within the next few weeks," said Tom Kloza, senior oil analyst with Oil Price Information Service in Rockville, Md., in his Speaking of Oil Web site on Monday.

Kloza said he bases his retail projection on current wholesale prices. Given that retail prices generally are some 60 cents a gallon more than wholesale, even the country's highest wholesale price, in California, is $2.46 a gallon.

A general economic slowdown, rapidly spreading worldwide, is the primary reason gasoline prices are falling, experts believe. So is speculators fleeing the commodities markets.

"Going from summer to fall, there always is a lot less usage, but this year there was even less usage," Bowers said. "Speculators pushed up prices as much as they could until people ran out of money, and when they run out of money, they do other things. People now are doing other things."

AAA East Central's weekly Fuel Gauge gasoline survey found the average price this week for a gallon of regular gasoline from a self-service pump dropped 14.5 cents from last week, to $3.408 from $3.553.

One big problem with lower gasoline prices is that the farther the price falls, the worse shape the national economy is in, said Duquesne University Kent Moors, director of the Energy Policy Research Group at Duquesne.

"The problem is, if the price goes down more, we're in a great deal of economic difficulty. People will be less concerned with lower gasoline prices for their SUVs and more concerned that when they get into that SUV, will they have a job to go to."

Concerns about the success of the federal government's $700 billion banking bailout, shrinking demand worldwide for petroleum products and concerns for a national recession have combined to grab the crude oil and thus the gasoline markets, with falling prices the result, Moors said.

"Oil prices are lower because the global economy stinks," Kloza said.

The federal government's Energy Information Administration on Tuesday issued its latest short-term energy outlook, in which it projects the average price for regular gasoline from a self-service pump during the final three months of the year will be $3.34, and $3.56 for the entire year. The annual figure is 75 cents higher than 2007's $2.81 average and exactly the same as the agency's 2009 average price projection.

Moors and Kloza cautioned drivers not to get used to lower prices. Moors said that the national credit crunch already is affecting some small-marginal oil producers that are shutting down or curtailing operations because they can't get financing to drill for crude oil.

Kloza said don't be fooled into believing the world suddenly has become conscientious about saving crude oil/gasoline, or willing to sacrifice for the good of all.

""We shouldn't be delusional about the prospects for considerably higher prices in 2009 or 2010 or beyond," Kloza wrote. "The world hasn't lost its appetite for oil -- we'll get drunk again."

Cheaper Gas Prices, but Less Demand

Universal Stainless cuts earnings forecast

Universal Stainless & Alloy Products Inc. of Bridgeville this morning revised its guidance for its third-quarter earnings, lowering its sales projections to about $57 million to $58 million, and earnings per share to 35 cents to 40 cents a share.

The revised guidance includes a charge of $586,000, or 6 cents per share, for relocating a round bar finishing facility from Bridgeville to Dunkirk, N.Y.

Universal Stainless, which makes semi-finished specialty steel products, had projected in July that its third-quarter sales would be in the range of $60 to $65 million and earnings per share of between 70 cents and 75 cents, after including the estimated relocation charge.

The company's sales from its Dunkirk plant were $2 million lower than expected because of lower shipments of aerospace products to service centers as a result of the strike at Boeing Co., Universal CEO Dennis Oates said. Shipments from the Bridgeville plant were lower than forecast last month because of production inefficiencies that coincided with its labor negotiations with the United Steelworkers Local 9531, Oates said.

The 220 steelworkers at the plant on Tuesday approved a new five-year labor contract, effective immediately, that provides for wage increases, maintains a defined contribution pension plan. The agreement, which replaces a pact that expired Aug. 31, keeps flexible work rule terms and profit sharing incentives contained in the prior agreement, the company said.

Universal intends to report final third quarter results on Oct. 23.

PPG to shutter 3 plants in streamlining move

Cut back on paper, earn cash at Citizens Bank

Citizens Bank said Tuesday it will pay customers up to $120 a year to use debit cards and pay bills online, part of a paper-saving program the bank hopes will garner more than 1 million online customers.

The Green program rewards customers 10 cents for each online bill payment or debit-card purchase, up to $10 a month and $120 a year. The rewards will be deposited directly into customers' checking accounts each month.

The program's name also refers to environmentalism. Citizens says Green can save about seven pounds of paper and 63 gallons of water a year by eliminating the average family's 19 paper bills and statements, and seven mailed payments, a month.

"It's broader than just the money you earn. You also help the environment," said Theresa McLaughlin, executive vice president and chief marketing officer of parent Citizens Financial Group, Boston.

"This is something that's emerging" in banking , said Jeffrey Green, editor in chief of CardsandPayments, a trade publication for the electronic payments industry.

Green likens it to a Bank of America program last year in which the bank rounded up to the nearest dollar all debit-card transactions and deposited the money in customer savings accounts. But that program did not include a bill-payment incentive, he said.

Dollar Bank has offered a similar, but more limited, incentive program since late 2006. The Pittsburgh bank pays 5 cents for each online bill payment and debit-card transactions in which cardholders sign instead of using a PIN, or personal ID number, said Vice President Jim Carroll Jr. But the program pertains to only one of the bank's four types of checking accounts.

Citizens customers who opt for the Green program, however, must choose to participate in it instead of Citizens' points-for-merchandise program, said spokeswoman Angela Wagner. It awards points for banking transactions, which can be redeemed for merchandise.

Since 2007, PNC Bank has periodically offered customers between $5 and $15 for paying at least three bills online, said spokesman Pat McMahon. The bank has long awarded points for debit-card use that customers can redeem for merchandise.

National City Bank has offered a similar points program for online bill paying and debit-card use since spring 2006, said spokeswoman Tammy McIntosh.

"Online bill payment rewards is not something I've seen before but the motivation is not new," said Greg McBride, senior financial analyst for Bankrate.com, North Palm Beach, Fla.

McBride said banks until five or six years ago charged customers a monthly fee if they wanted online bank accounts, in order to pay for banks acquiring such systems. Now largely paid for, online banking capability is "almost universal," he said.

"And it's less expensive to process electronic payments than handle checks or cash," said McBride. "Plus, it solidifies the customer relationship."

Debit cards have surpassed credit cards as the most frequently used form of electronic payment. The Federal Reserve Board in December estimated there were 25.3 billion debit-card transactions made in the United States in 2007 vs. 21.7 billion by credit card.

At least 40 million households were using online banking accounts to pay bills, check balances or transfer funds by 2007, said the Federal Reserve Bank of Kansas City.

Green is available at all 1,600 branches of Citizens and its sister bank, Charter One, in 13 states, including Pennsylvania. The banks are planning a multimedia advertising campaign.

Stashing Cash at Higher Rates

Bloomfield residential plan may be pared

Developers said the nation's financial crisis may force changes in the $230 million Baum Liberty Crossing project in Bloomfield, including reducing its size and asking for public financing for part of the project.

One change may be building 70 apartments instead of 50 condominiums in a proposed seven-story building that's planned in the first phase, said Mark Dellena, executive vice president of Doc-Economou, part of the development team.

Dellena, speaking before about 100 residents from seven neighborhood groups at a Monday night meeting to review a traffic plan for the project, said today's financing markets seem to have more money for apartments than for condos.

"We may later convert the apartments to condos," he said.

And, he said, the developers will seek public financing, although he declined to identify how much or from where.

"We need public support for infrastructure that includes parking, trees and sidewalks," he said.

A traffic impact study, prepared by Trans Associates, is being reviewed by the City Planning Department and was not available at the meeting.

"Depending on market conditions, we may have to scale down the building by a floor, or provide only 1 1/2 levels of underground parking beneath the building instead of two levels," he said.

City Councilman Bill Peduto arranged the meeting in hopes residents could review the traffic and parking plan for the development, to be located on the former Don Allen Auto site at the corner of Baum Boulevard and Liberty Avenue.

His hope is to have a traffic/parking plan that is acceptable to residents prior to an Oct. 23 hearing before the City Zoning Board of Adjustment on variances sought by the developers to permit a seven-story building in a zone that permits four stories.

"Without the support of the community, I will not support the project," Peduto said.

Current plans call for the first floor and portions of the second floor for retail, three floors of about 140 to 160 hotel rooms and two top floors for condominiums. The project involves four city blocks, stretching from Ritter's Diner on the west and the Children's Home on the east.

The master plan for the 5.5-acre site includes four buildings -- two of four stories and one of three stories, plus the seven-story structure -- which would house about 300,000 square feet each of office and retail space, the extended-stay hotel and condominiums.

Parking, traffic issues stall Squirrel Hill project

Heinz to acquire Australian juice maker

H.J. Heinz Co.'s Heinz Australia unit has made a $288 million offer to acquire Golden Circle Ltd., one of Australia's best-known fruit juice makers.

"This is a win-win for both Golden Circle and Heinz," said Heinz Australia in a statement. "This proposed acquisition brings together two of the best known and most respected food brands in Australia."

Golden Circle was founded in 1947 and has about 1,000 personnel working at two factories. The company is recognized as one of Australia's top 15 brands.

The Golden Circle board already has unanimously recommended the Heinz Australia proposal and is expected to vote its shares in favor of the deal on Nov. 14. The deal is subject to shareholder and regulatory approvals.

Heinz stops use of Chinese milk in products

Bailout fails to soothe anxiety

Relief on Wall Street over the hard-won passage of a $700 billion bailout package for the financial system apparently hasn't yet trickled down to the pubs, storefronts, car lots and malls of Main Street.

Many Americans spent an uneasy weekend wondering whether the rescue would help in time -- or at all -- and trying to figure out where next to cut back as the economic screws tighten.

Would financing come through for the new washing machine? Could the old car hold out another year? Would a nice dinner out bust the budget?

"People are afraid," said Linda Morrow, who owns a shoe and handbag store in a Dallas mall. "People basically don't know what the future will bring. They're afraid to spend. They want to see what the bailout will do. They're waiting till after the election."

In more than two dozen interviews with The Associated Press across the country over the weekend, Americans described those concerns, from tighter personal credit to worries about small businesses to doubts about simply making ends meet.

Matt Watson, a 41-year-old sales manager at a showroom of motorcycles and all-terrain vehicles in Morgantown, W.Va., said his family has cut back on dinners out and is buying more generic products.

The other day, he grabbed a $5 bill off his dresser and headed to a Walgreen's drugstore for milk and bread.

"I could not buy milk and bread for $5," Watson said, shaking his head in disbelief.

Aimee Robinson needs a $200,000 loan soon for her business, which sells eco-friendly furniture in Seattle, and wonders whether the bailout might ease the way. The interest rate on her store's credit card just jumped to 17 percent from 8 percent.

"Everything came to a standstill" this summer, she said. "It hit me really, really bad."

The bailout plan, quickly signed into law by President Bush after it passed the House by a comfortable margin Friday, will buy bad mortgage debt off the books of staggering banks in hopes of shoring up the American financial system.

It was put together during a harrowing three weeks for the U.S. economy that began with the bankruptcy of investment house Lehman Brothers and a government bailout of insurer American International Group.

The damage has seeped into far-flung corners of the economy. At a company called Tortilla Lady in Flagstaff, Ariz., five women make 1,500 to 1,800 dozen tortillas in an average week, some sold in the shop and others to stores.

For the week of Sept. 15, the week Lehman Brothers collapsed and the crisis took hold, production was only about 1,000 dozen.

"Once this really got into the news and people started understanding what Wall Street meant to them, they've become more conscious of their own budget and the limitation of their budget," said Phebe Faus, an owner of Tortilla Lady.

An AP-GfK poll released last week before the House passed the revised bill found Americans divided on whether they supported the bailout. But a solid majority, eight in 10, said they feared the financial crisis would hit them directly. Many said they were conflicted, lamenting that taxpayers had to step in but believing something had to be done to prop up the economy.

Among that type of adherent is Morgan Cavanaugh, owner of a 75-year-old Irish pub that sits a few blocks from Lake Erie in downtown Cleveland. Standing behind the weathered mahogany bar, he said the bailout stinks.

"I don't believe we should let them off the hook," he said. "Either we pay now or we pay later. To me, it's extortion."

To him it's necessary: The same day, he was talking on his cell phone to a man who has been trying to buy a suburban bar from Cavanaugh but has not been able to secure a loan.

"It passed," Cavanaugh told the man just after the House vote Friday. "Let's work something out." He said the man planned to try for the loan again and said the prospects were "looking up."

As for business at the bar: Cavanaugh has lowered his drink prices for his customers, a crowd heavy with bankers and brokers. He calls the special the Bankers' Booze Bailout Fund.

Tight credit remains at the heart of the crisis. In a financial climate of fear and mistrust, banks are charging one another much higher rates to borrow money, and they are snapping their wallets shut to Americans.

The bailout package may get the gears of lending moving again, but it hasn't happened yet.

Last year, Pennsylvania auto dealer Bill Rosado's customers had no trouble arranging financing for the cars and trucks they bought. Banks were lined up to provide cash even for people with a risky credit history.

Those days are gone. A customer with decent credit who might have been approved for 100 percent financing not long ago is lucky to get a loan at all today, and even then the interest rate is almost guaranteed to be higher.

"The people with horrible credit, I can justify saying, 'No more,'" Rosado said. "But this is affecting people whose credit isn't that bad. People with 650 credit scores are being turned down."

The rescue was aimed in part at restoring confidence in the financial markets. As the crisis worsened, stocks took a huge hit, and Americans seeing their stock funds and retirement savings sapped are more reluctant to spend money.

"A lot of people who come here are wealthy people, and they've lost a lot of money in stocks," said Jaime Galvan, who manages a car wash in Long Beach, Calif. "Most of the people, they're concerned. They don't want to spend."

And a turnaround is no guarantee. President Bush has warned it will take "some time" for the full effects of the bailout bill to take hold in an economy that had a world of trouble even before the banking crisis.

In the meantime, Americans are left to find ways to cut back even further.

In Dallas, sales assistant Yvonna Vaughan downgraded from Newport cigarettes to less expensive Kools and wonders whether she'll be smoking generics before long.

In Denver, secretary Bernice Adolf pays close attention to the sales at her grocery store and makes spaghetti at home with her husband on Friday night instead of their usual dinners out.

"We're trying to save wherever we can," she said. "I don't think the bailout is going to last too long."

At Zeitoun, a Mediterranean restaurant not far from the Miami airport, owner Samira Marino has noticed everyone is ordering water and more people are sharing meals.

Mike Belo of Columbia, S.C., hasn't put off any major purchases -- yet. But he's keeping an eye on his business as a property insurance agent, which has dipped as new home sales have slowed.

"It's hard to get a handle on it," he said of the bailout. "I'm not in favor of bailing out a bank, but I guess if it's the No. 1 bank that offers the money ... we're in a no-win situation, really."

"If I go under," he said, "no one's going to bail me out."

Views on the Bailout, from Harlem to Wall Street

Region’s financial experts clash on need for bailout

Four House members from region vote ‘no’ on bailout

The Bailout: Public Anger, Private Talks

Job losses underscore arrival of recession

The economy is crashing down on Jim Slovick.

The country last month shed jobs at its fastest pace in five years, the U.S. Department of Labor said Friday, and Slovick knows the downward slide isn't done yet. His employer, Ryerson Steel, is closing its Carnegie plant. Slovick doesn't know when his last day of work will be, but he knows the remainder of his 39-year career is measured in weeks, not the years he'd once counted on.

At 62, he's too young to collect his full Social Security benefits but too old to start anew.

"We don't want to retire. We want to work. I'm healthy," said Slovick of McDonald. He and co-worker Jay Clayton, 55, of Carnegie shared their plight with 12 other union members during an hourlong discussion with Richard Trumka, secretary-treasurer of the AFL-CIO, and Jack Shea, head of the Allegheny County Labor Council.

"I'm 55 years old with 33 years of service," Clayton said. "Where do I go?"

Employers cut 159,000 jobs in September. The department changed its unemployment figures for July and August, saying the economy lost 4,000 more jobs than previously thought. That brings the total job losses this year to about 768,000.

"This was a very weak job report. It confirms the U.S. is in a recession," said Stuart G. Hoffman, chief economist for PNC Financial Services.

The $700 billion-plus financial bailout passed by Congress yesterday will free up credit, getting some blood flowing in the economy again, but its effects for most people won't be immediate, Hoffman said. Job losses will continue for a while. That likely will dampen the holiday shopping season, which many businesses depend on to survive the year.

"It's going to get worse. These things don't come and go overnight," Hoffman said. The federal government can do little if anything more but ride this out, he said. "I think they've pulled as many rabbits out of their hats as they can."

Trumka, who also spoke to the United Steelworkers to stump for Democratic presidential candidate Barack Obama, said the employment situation could be even more grim than it looks. If the unemployment rate were calculated the way it was 20 years ago, it would be close to 15 percent, rather than 6.1 percent, Trumka said.

"This economy is not working for us," Trumka said. "One out of 10 Americans who wants to work full time cannot find a full-time job."

Over the past 12 months, the number of unemployed people rose by 2.2 million, mostly in construction, retail and manufacturing sectors. Long-term unemployment -- people without a job for more than half a year -- account for 2 million of the jobless.

Slovick and his 18 co-workers expect to join their ranks soon. A woman who answered the phone at Ryerson's Carnegie plant said the plant would close in three weeks. Executives at the company's corporate headquarters could not be reached for comment.

Republican presidential candidate John McCain said Obama's economic plan would make matters worse.

"Unlike Sen. Obama, I do not believe we will create one single American job by increasing taxes, going on a massive spending binge, and closing off our markets," McCain said in a statement.

Obama, speaking in the Philadelphia suburb of Abington, blamed the crisis on an "economic philosophy" of deregulation and reliance on market forces that he said McCain and President Bush share.

"We've tried it their way. It hasn't worked. And it won't work now," Obama said.

McCain and Obama on Small Business Issues