Gasoline may near $5 by summer
Get ready to pay $4 a gallon or more for gasoline this spring, with possible records close to $5 over thememorial Day weekend, analysts said.
“Motorists who drive a SUV may want to consider calling their banking institution and obtain a credit-limit increase so they can afford this summer’s fuel expenses,” quipped Patrick Dehaan, senior petroleum analyst for Gasbuddy.com.
Look for a springtime U.S. average of $4.05 for a gallon of self-serve regular gasoline, said Tom Kloza, chief oil analyst for the Oil Price Information Service. The New Jersey company provides daily fuel-price averages for the AAA Fuel Gauge Report using credit card receipts from more than 100,000 retail outlets across the U.S.
That would fall short of the inflation-adjusted record of $4.114 reached in the summer of 2008, according to Energy Department statistics.
California’s average would be higher than the U.S. average, Kloza said, adding that he didn’t expect it to hit the state’s record of $4.588 a gallon.
Gasoline prices are starting the year at the highest point ever because of high oil prices and brisk fuel exports.
In New York futures trading Friday, West Texas Intermediate crude fell 49 cents to $98.61 a barrel. Much of the oil the U.S. imports is based on the price of Brent North Sea crude, which was trading at $110.38 a barrel in London. Other sources of U.S. crude are also more expensive, Kloza said.
“The Alaska North Slope oil you rely on in California has been trading at about $10.40 a barrel more than West Texas. Louisiana crude from the Gulf of Mexico has been trading $11 a barrel higher,” Kloza said.
Several U.S. cities will see record average prices this spring, according to the annual price outlook from GasBuddy.com, where 300,000 to 400,000 member motorists a day post prices to more than 250 websites for towns across the U.S. and Canada.
Gasbuddy.com is predicting record spring prices in several cities, including Los Angeles, San Francisco, Chicago, Dallas, Detroit, Miami, Minneapolis, New York, Philadelphia and Seattle. Los Angeles could see $4.70 a gallon. Chicago could see $4.95 a gallon.