Summer Gas Prices: A Repeat of Last Year

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Summer Gas Prices: A Repeat of Last Year

NEW YORK -- Gasoline prices across the country have gone up more than 8 cents in the past two weeks and 69 cents so far this year, according to the latest Lundberg Survey of 7,000 gas stations across the country, the Associated Press reported.

Prices were about 15 cents below the all-time record in August 2006, when regular gas averaged $3.03 per gallon. The average cost of regular on Friday was $2.87 per gallon. Nationwide, the lowest average price for regular fuel was $2.65 in Minneapolis. The highest was in San Francisco at $3.37 a gallon.

Looking forward to this summer, the Energy Information Administration (EIA) predicted that gas prices will near last year’s average, with the retail price for regular to average this year at $2.81 per gallon, 3 cents below the year-ago average of $2.84 per gallon.

The agency's April Short Term Energy Outlook, released last week, also reported that the peak for this year is expected to come in May, at $2.87 per gallon. Last year, the peak arrived in July, averaging $2.98 per gallon.

The recent retail gas price jumps are due to higher crude oil prices, unplanned refinery stoppages, increased demand for gas and low imports from Europe, the EIA said.

West Texas Intermediate crude oil will average $65 per barrel this summer, five dollars lower than the average price for last year. For the rest of 2007 and 2008, the price for crude oil will average $64 per barrel, the agency estimated.

Global oil demand was forecast to grow by 1.5 million barrels per day in 2007, and 1.6 million barrels per day in 2008. One half of the projected growth in consumption will be from the U.S. and China, the report stated. Meanwhile, average U.S. crude oil production is expected to decrease by 30,000 barrels per day in 2007, to 5.1 million barrels per day. In 2008, a 4.3-percent increase in production is expected, resulting in an average production rate of 5.3 million barrels per day, according to the administration.

The agency also reported that retail diesel fuel prices will average $2.82 per gallon, a 6-cent drop from last summer.