Gas prices rise another 2.5 cents per gallon

/ Source: news services

Gas prices climbed another 2½ cents in the past two weeks as high crude oil prices and tight capacity contributed to record prices at the pump, a national survey said Sunday.

The nationwide average in the past two weeks that ended Friday was $1.82 for all grades, said Trilby Lundberg of the Lundberg survey, which regularly polls 8,000 stations across the United States.

Gasoline prices are up 31.5 cents per gallon nationwide since late December, Lundberg said.

"The prices keep breaking their own records every week," she said.

The national weighted average price of gasoline, including taxes, at self-serve pumps Friday was about $1.79 for regular, $1.89 for midgrade and $1.98 for premium.

San Diego had the highest average price for self-serve regular, at $2.22 per gallon, up 10 cents from two weeks ago.

Demand is not expected to slow over the next few weeks as the peak summer travel approaches, crude oil prices remain around $37 per barrel, and refineries temporarily shut down their plants for maintenance.

U.S. crude-oil futures were up 51 cents to 37.65 a barrel in late-morning trading in New York.

Snow slams OPEC
U.S. Treasury Secretary John Snow on Monday called the recent cuts in oil output by OPEC producers “most” unwelcome, saying they were creating worrying energy price rises for American consumers.

Interviewed on a local radio station as he prepared for a day-long series of public events in Kansas City, Snow said the Bush administration has told members of the Organization of Petroleum Exporting Countries of its displeasure.

“We’re very concerned and the actions by OPEC in reducing its quota are most unwelcome,” Snow said when asked about spiraling gasoline prices. “We’ve let OPEC know that we don’t think well of these actions. The situation is a serious one.”

Snow said he hoped concern over energy price rises might make Congress speed up work on the Bush administration’s proposals for a new energy policy, which have stirred controversy because they would include more drilling in environmentally sensitive areas in Alaska and elsewhere.

OPEC members have agreed to an output quota cut of one million barrels per day from April 1 to blunt the effect of a seasonal downturn in demand in the second quarter.

The U.S. Energy Department is forecasting record high summer gasoline prices, some 20 cents above last year on average, due to strong consumer demand and tight gasoline supplies caused by lower OPEC output quotas.

Rising energy prices and OPEC’s decision to cut oil output have grown into a big issue in the U.S. presidential campaign.

The Bush administration says it has been in contact with OPEC ministers to ensure there is enough oil to keep the U.S. economy growing. However, Democratic challenger Sen. John Kerry says President George W. Bush must take a tougher stand against OPEC and demand the cartel open its oil spigots.

The effect on gas prices has been magnified this year because commercial gasoline inventories are already low. The federal government said last week that gasoline prices will rise another nickel a gallon nationwide before the end of June but return to current levels before the fall.

The hardest hit areas will likely be the West Coast and the Northeast.