Gasoline nears $2.25, crude briefly above $60
COLUMBUS, Ohio — Retail gasoline prices rose again overnight and are now up nearly 40 percent from the start of the year, while the price for crude on Tuesday topped $60 a barrel for the first time since early November.
Just a week ago, drivers nationally paid about 17 cents less for a gallon of gas on average.
Crude wavered after hitting $60.08 early Tuesday, but still closed up 35 cents at $58.85 a barrel on the New York Mercantile Exchange. That’s more than 80 percent above prices in December when crude was bottoming out.
Prices at the pump rose 2.2 cents to $2.248 a gallon overnight, according to motor club AAA, Wright Express and Oil Price Information Service. While the cost for a gallon has risen less than a quarter in the past month, most of that increase, 16.9 cents, has occurred in just the last week.
Prices are rising faster this week than they did last year, when gasoline embarked on a record run toward $4.11.
No one is expecting a repeat of last summer, however, and many think prices have only about another nickel to go before topping out.
This is the time of year, as the country gears up for the Memorial Day holiday, that prices tend to begin an upward climb.
What’s different this year is the amount of crude, and gasoline, that is now in storage. The country has not seen storage levels this high since Saddam Hussein invaded Kuwait in 1990.
Including the Strategic Petroleum Reserve, crude in storage has passed the 1 billion barrel mark and set a ninth straight weekly storage record on May 1.
That trend is expected to continue when the Energy Information Administration reports crude levels Wednesday. The level of gasoline in storage is also expected to grow.
On the surface that should mean prices are falling, but because the bad economy has people driving less, refiners have slashed production.
The price of gas will depend on how well those refiners have matched demand, or lack of it.
The government released a report Tuesday that predicts gas consumption will remain paltry through 2010, compared with 2007 before the recession took hold.
Comparatively low prices at the pump this Memorial Day are expected to put more people behind the wheel for the three-day weekend.
AAA estimates predict a 1.5 percent increase in travel. Last year, travel during the weekend fell 9.6 percent as gas prices began to rise.
In other Nymex trading, gasoline for June delivery fell 1.3 cents to $1.6672 a gallon and heating oil dipped less than a penny to $1.51 a gallon. Natural gas for June delivery rose 14.7 cents to settle at $4.449 per 1,000 cubic feet.
In London, Brent prices rose 46 cents to settle at $58.11 a barrel on the ICE Futures exchange.
Associated Press writers George Jahn in Vienna and Alex Kennedy in Singapore contributed to this report.
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