U.S. gasoline prices take unexpected rise

WASHINGTON, June 16 (UPI) -- Retail gasoline prices in the United States are making a surprise surge as high demand and ongoing refinery issues crimp supplies, motor club AAA said.

AAA reports a national average retail price for a gallon of regular unleaded gasoline at $2.80 for Tuesday, about six cents higher than last week and 10 cents higher than one month ago.

The motor club in its weekly fuel gauge report said the new high-water mark for 2015 is attributed to a decline in gasoline stocks caused in part by higher fuel demand and "persistent refinery problems, which has limited gasoline production."

Separate analysis from price-watchers at GasBuddy.com found retail gasoline markets in the Midwest were among the hardest hit by refinery issues, with Indiana and Michigan posting the highest weekly gains with an average 27 cent increase per gallon.

GasBuddy finds almost 90 percent of all retail service stations in the country are selling gasoline for more than $2.50 per gallon, up from 81 percent last week. The number of stations posting gas prices above $3.50, however, fell more than a full percentage point to 4.5 percent.

The price-watching website said gasoline prices in the Great Lakes region should pull back as crude oil prices soften for June. AAA said in its report the cost of crude oil is the dominating factor in the price consumers pay for gasoline.

"Saudi Arabia, the world's leading crude exporter, is reportedly prepared to increase its production to meet strong demand, which likely would keep a ceiling on the price of crude," it said. "Domestic production also remains elevated and is expected to remain at or near current levels, despite the reduction in U.S. oil rig counts."

The U.S. Energy Information Administration said in a market report for June it expected retail prices to average $2.44 for full-year 2015 and $2.55 for next year.