Gasoline price hike biggest since 2009

Feb. 21, 2013 at 2:30 AM
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HEATHROW, Fla., Feb. 21 (UPI) -- An average U.S. monthly jump of 47 cents a gallon for regular unleaded gasoline is the biggest in nearly four years, and much earlier than usual, AAA says.

Retail gas prices have climbed 34 days in a row, the motor club federation said. An average gallon of regular unleaded cost about $3.30 a month ago, but it stood at $3.77 nationwide Wednesday, the club said.

The 47-cent increase translates to a hike of nearly 14 percent -- the most dramatic increase since June 2009.

On Tuesday, when the price increase was 44 cents in 33 days, AAA said the trend was "the longest streak since the price increased 44 cents over 44 days March 22-May 5, 2011."

The largest one-month increase on record was Aug. 5 to Sept. 4, 2005, when prices jumped 75 cents largely because of Hurricane Katrina, AAA said.

"This year's run-up is not only larger and faster than recent years but is beginning earlier," AAA said in a statement. "The national average in 2011 increased by just 7 cents during the same 33 day period and in 2012 it increased by 18 cents."

The year-ago average was $3.57 a gallon for regular unleaded, AAA said Wednesday in its Fuel Gage Report.

Three states have average regular gas prices of $4 or more, with Hawaii at more than $4.30 a gallon, California at around $4.18 and New York at $4. Hawaii's gas was $4.08 a month ago, California's was $3.65 and New York's was $3.72.

The three states with the least-expensive average regular are Wyoming at $3.20 a gallon, Montana at $3.21 and Utah at $3.39. Wyoming's gas was $2.80 a month ago, Montana's was $3.01 and Utah's was $2.86.

"One reason for the earlier price increase is the trend of U.S. refineries performing seasonal maintenance and making the switch-over to summer blend gasoline production earlier in the year," AAA said.

Summer-blend fuels, which are required in many parts of the country, are more expensive to produce than winter blends.

This year's run-up began Jan. 17, about two weeks earlier than last year, AAA said. The run-up last year led to a price rise during 66 of 71 days, and gasoline peaked at $3.94 April 5 and 6, AAA said.

"The price run-up in 2011 began in mid-February, when the national average increased for 27 consecutive days, starting an 86-cent surge to the peak of $3.98 on May 5," AAA said.

Another factor in the price increase is lower crude-oil production from members of the Organization of Petroleum Exporting Countries. Key supplier Saudi Arabia is producing about 700,000 fewer barrels a day than a year ago, the International Energy Agency says.

But global inventories are abundant, the IEA says, and "OPEC has plenty of spare capacity that it could bring into production to lower oil prices at a moment's notice," the Monday Morning investors website said Wednesday.

The current price of crude oil, which makes up slightly more than two-thirds of the price of gasoline, is widely considered high by historical standards.

Oil for April delivery settled at $95.22 a barrel on the New York Mercantile Exchange Wednesday. In London, the price was $115.60 a barrel on the ICE Futures Exchange.

One analyst predicted gasoline prices would peak by early April.

"Whatever you pay on St. Patrick's Day will be considerably more than you'll pay on July 4th or Labor Day," Tom Kloza of the Oil Price Information Service told USA Today.

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