Gasoline prices surge in state and nationwide
Retail gasoline prices skyrocketed during the last week -- up on average nearly 14 cents a gallon in California and nearly 9 cents nationwide -- as record oil prices trickled down to the pump, a government report showed Monday.
California drivers are paying an average of $3.328 a gallon for self-serve regular gasoline, up 13.7 cents from the Monday before and 53.2 cents higher than a year earlier, according to the Energy Department’s weekly survey of service stations. The national price for regular unleaded gasoline increased 8.8 cents to an average of $3.13 a gallon, up 75 cents from a year ago.
The state and national averages are closing in on their all-time highs set last May of $3.461 a gallon in California and $3.22 a gallon nationwide.
Meanwhile, the price truckers paid for diesel fuel soared 15.6 cents during the last week alone to a record $3.552 a gallon, up $1 from a year ago and surpassing the prior high of $3.44 set last Nov. 26, the Energy Department said.
In California, diesel hit a record of $3.672 a gallon, up 16.1 cents in the last week and 76.1 cents in the last year. The previous record, set Nov. 12, was $3.663 a gallon.
Even though U.S. gasoline inventories are the largest in 14 years, motorists are paying more at the pump as higher crude oil costs, which are near $100 a barrel, are passed on to drivers.
Many analysts believe gas prices could climb to record highs between $3.75 and $4 a gallon this spring. The Energy Department’s latest forecast calls for gas prices to peak near $3.40 a gallon this spring because of expensive crude, extensive refinery maintenance and increased driving. California prices also are reacting to the annual switch to cleaner-burning fuel grades used in warmer weather.
“We’ve just about caught up with the wholesale surge. There’s always lag between wholesale and retail,” said Tom Kloza, publisher and chief oil analyst at Oil Price Information Service in Wall, N.J. “This is a little bit of a false start to a rally that has more to do with oil and not as much with gasoline.”
Other analysts also point to inventory levels at a 14-year high that won’t support these prices for long.
“We have record high prices, but we don’t have record tight inventories,” said Tim Evans, an energy analyst at Citigroup Global Markets. “Whether traders acknowledge this or not, these are bear market conditions.”
Light, sweet crude for April delivery gained 42 cents to settle at $99.23 a barrel on the New York Mercantile Exchange. It climbed as high as $99.70 a barrel on supply concerns heightened by a Turkish military incursion into northern Iraq and warnings by Iran against further international sanctions.
