Where I live they always predict on the radio if gas will go up or down tomorrow and get it right. What is involved in making that prediction?
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Gas generally is aligned directionally with the price of oil. If oil goes up, gas goes up, if oil goes down gas goes.
If people think the price of oil is increasing, they will say that gas may go up. They may be wrong, maybe oil goes down, or no change, but they can still say it. Saying “gas will go up” means nothing until it actually does, and unless you’re putting your money where your mouth is, there’s no penalty for being wrong. They absolutely do not ALWAYS get it right. But economists and traders know the patterns and roughly what to expect. Your local radio etc. isn’t making their own predictions, they probably just look at what someone else is saying.
Example: Gas is going up tomorrow.
For oil, there’s a lot of metrics, such as worldwide oil production, that are very good indicators of the direction oil is trending, so people look to those when they think about what the price will be in the near term.
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