Gasoline prices hit record, pushed by bets that prices will rise
Hedge funds, commodity pools and other high-roller investors have thrown close to $12.5 billion into a collective bet that gasoline prices will rise, and some analysts say it’s one reason why gasoline prices are at a record for this date in California and nationally.
The details were contained in the Commodity Futures Trading Commission report released Friday, showing that betting on higher gasoline prices was closing in on the highest level ever of $13 billion, set last March.
“There has never been this much money bet on higher gasoline prices this early in the year,” said Tom Kloza, chief oil analyst for the Oil Price Information Service.
The average price for a gallon of regular gasoline in the U.S. is $3.587, which is 7.8 cents higher than the record for Feb. 11, set last year.
In California, the average price of a gallon of regular gasoline jumped 14 cents over the past week to $4.054.
Jeff Spring, a spokesman for the Auto Club of Southern California, said that was not only a record for today. Spring said it was also the earliest week in the year that the state’s average topped $4 a gallon.
Analysts said was suffering mostly because its refineries have more scheduled maintenance than usual and because it is heavily dependent on more expensive foreign oil.