Energy Dept. explains high gasoline prices

Feb. 26, 2013 at 8:19 AM

WASHINGTON, Feb. 26 (UPI) -- The U.S. Energy Department said some factors contributing to retail gasoline prices spikes aren't yet felt by consumers at the pump.

Retail gasoline prices for a gallon of regular unleaded Tuesday ranged from $4.23 in California, a 15 percent increase for the year, to $4.01 in New York, a 28-cent increase month-on-month, motor group AAA reports.

The U.S. Energy Department's Energy Information Administration said refinery outages and the switch to more expensive summer blends of gasoline were in part to blame for higher prices at the pump.

So-called crack spreads, the difference between wholesale gasoline prices and crude oil prices, were identified by the EIA as accounting for more than 60 percent of the price increase. During the fourth quarter, the EIA said a barrel of Brent crude oil was worth less than a barrel of gasoline, which was reflected in late 2012 gasoline prices.

"Between Jan. 1 and Feb. 19, the price of Brent crude oil, the waterborne light sweet crude grade that drives the wholesale price of gasoline sold in most U.S. regions, rose about $6 per barrel, or about 15 cents per gallon," it said.

The U.S. Energy Department said it expects gasoline prices for 2013 to average $3.55 per gallon. Short-term, however, the EIA said it's "possible that a part of the rise in wholesale prices has not yet been fully reflected in pump prices."

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