Oil tops $75 a barrel; gasoline prices sink again
Oil prices climbed back above $75 a barrel Monday, but supply and demand fundamentals again forced retail gasoline into retreat over the last week, with pump prices falling nationally and in California, the U.S. Energy Department said Monday.
Analysts said crude oil futures were buoyed by indications that Federal Reserve Chairman Ben S. Bernanke might have enough congressional support to be reconfirmed to that post.
“The market clearly thinks that a change in leadership at the Federal Reserve would be disruptive to the U.S. economy,” said Phil Flynn, an analyst for PFGBest Research in Chicago.
Crude oil futures for March delivery settled at $75.26 a barrel, an increase of 72 cents.
Gasoline prices, meanwhile, continued to follow the influence of very weak demand, in spite of some recent refinery problems around the nation.
The average price of a gallon of regular gasoline in California fell 1.8 cents to $3.008, according to the Energy Department’s weekly survey of filling stations. Nationally, the average price fell 3.4 cents to $2.705 a gallon.
Flynn said that reflected weak numbers from the Paris-based International Energy Agency, which said that the U.S. “had a huge build in gasoline supply of 3.3 million barrels last week and a historically low refinery run rate of just 78.4% of capacity.”
“The refinery run rate just seems to scream out weak non-weather-related demand for gasoline,” Flynn said.
In its most recent petroleum industry report, the Energy Department last week said that gasoline supplies in the U.S. were at a 22-month high.