Average Gasoline Price Jumps 8.9 Cents in State
California motorists saw the average price for self-serve regular gasoline jump 8.9 cents a gallon, the fourth weekly increase in a row, as the U.S. average gained 2.1 cents, an Energy Department report indicated Monday.
Prices increased the most in California, where the average hit $2.513 a gallon, up 47.9 cents from this time last year. The U.S. average of $2.357 a gallon was 44.6 cents higher than a year earlier, according to the weekly survey of 800 filling stations.
Regular gasoline rose 3.2 cents to $2.314 a gallon in the Midwest and 1.8 cents to $2.238 in the Rocky Mountain states. Prices in the East Coast states fell 0.1 cent to $2.394 a gallon.
Diesel fuel rose 1.7 cents to $2.489 a gallon. In California, the average diesel price increased 5.9 cents to $2.733 a gallon.
Gasoline costs are increasing because oil prices are rising and several refineries around the nation are undergoing seasonal maintenance work, which reduces production. California is feeling an additional pinch because refineries are preparing for the annual switch to summer-grade gasoline.
The nationwide slowdown in fuel production was reflected in New York futures trading Monday as oil tracked a big rally in U.S. gasoline futures.
The gains came as OPEC ministers gathered in Vienna to discuss crude oil production policy for the first half of 2006, with most members of the group giving strong support to keeping output near a 25-year high.
U.S. light crude rose 59 cents to $68.35 a barrel on the New York Mercantile Exchange, bringing prices within reach of the $70.85 intraday trading peak hit in late August.
Traders said crude was trailing a surge in U.S. gasoline futures, which rose 3.85 cents to $1.775 a gallon after word that at least one major refinery was slowing fuel production because of a drop in profit margins.
BP cut operations at its plant in Whiting, Ind., by 10% to 15% as Midwest profit margins fell to their lowest level in several years because of a regional glut, according to market sources. BP declined to comment.
The Organization of the Petroleum Exporting Countries appeared poised to keep pumping crude near full throttle. The cartel, which produces more than a third of the world’s oil, has been pumping close to 30 million barrels a day for months.
Saudi Oil Minister Ali Ibrahim Naimi said the world’s biggest exporter saw no need for a cut at the meeting or at any time this year.
Oil prices are up about 10% this year, bolstered by tensions in Iran over its nuclear ambitions and by militant attacks against oil companies in Nigeria.
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Bloomberg News and Reuters were used in compiling this report.
