The average price of gas was slightly lower over the past three weeks due to plentiful supply. However, that is expected to change as retailers pass on the higher cost of wholesale gasoline to consumers. Late last week, an increase in crude oil prices prompted refiners to lift the prices of refined products they charge wholesalers.
Sunday, 14 Jul 2013 05:40 PM
The average price of U.S. gasoline dipped slightly over the past three weeks due to plentiful supplies, but prices are expected to jump soon as retailers pass on the higher cost of wholesale gasoline to consumers, the Lundberg survey said on Sunday.
Gasoline cost $3.5908 a gallon on average, according to the widely followed survey of about 2,500 retail stations taken on July 12. That is 0.61 cent a gallon cheaper than the last survey on June 21, but still 18.05 cents higher than a year ago.
That average price masked a huge dollar difference in the price of gasoline in various cities. In a sampling of cities in the lower 48 U.S. states, the cheapest gallon could be found in Charleston, South Carolina at $3.22 while consumers in Chicago had to pay prices of $4.04.
Late last week, an increase in crude oil prices prompted refiners to lift the prices of refined products they charge wholesalers. Now retailers are expected to pass on higher cost of wholesale gasoline to consumers, said Trilby Lundberg, author of Lundberg survey.
"If crude oil prices stay approximately where they are right now, what we may see in coming days would be about 10 cents per gallon price hike overall at the pump," said Lundberg.
On Friday, crude oil futures rose, led by the biggest surge in gasoline futures this year as a string of refinery outages stoked concerns about fuel supplies in the heart of the U.S. summer driving season.
On Friday, front-month U.S. crude oil futures settled up 1 percent at $105.95 per barrel. U.S. crude futures have increased around 10 percent in the last three weeks.
However, Lundberg said gasoline supplies are ample and the utilization rate of U.S. refining capacity remains at historically high levels at above 90 percent.
Possible rising prices at the pump are more likely to reflect more expensive crude oil, which is often the most dominant driver of gasoline prices, Lundberg said.
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