Gasoline Prices Reach Record Levels Tuesday

Alan Fein

New York - According to the latest Lundberg survey of 7,000 gasoline stations nationwide, the average price of a gallon of regular gasoline is $3.00, an 11 cent per gallon increase in over the last two weeks and the second highest level in history.

The national pump price for regular unleaded gasoline is up 65 cents from a year ago and not far from the record $3.07 reached last September after Hurricane Katrina disrupted petroleum supplies.

The rise at the pump reflects an increase in U.S. crude oil prices, which accounts for about half the cost of making gasoline. The price for oil for delivery in August hit a record $75.78 a barrel last week.

The EIA had reported earlier that the average price for a gallon of regular gasoline would decline to $2.76 per gallon this summer. Now, the EIA is expected to revise that estimate on Wednesday when it releases its weekly stocks report. AAA reports that in some states, gasoline prices have already reached new records. In Connecticut, the average price of a gallon of regular gasoline is now $3.19 per gallon, an increase of a nickel over last month's average of $3.14 per gallon. A year ago, Connecticut residents were paying $2.40 for a gallon of regular gasoline.

In Akron Ohio, the average price for a gallon of regular gasoline is close to the national average at $2.87 per gallon, but to Californian's that's cheap. The average price for a gallon of regular gasoline in California has topped $3.25 per gallon and in New York, consumers are seeing $3.50 at the pump.

To the north, gas station operators in New Brunswick Canada have shut down stations in protest to fixed prices there. Approximately 90 New Brunswick gas retailers began welcoming customers at midday Tuesday after closing for a half day to pressure the government into raising the regulated pump price above $1.12 per liter.

Kevin McCann, New Brunswick sales manager for Wilson Fuel Co. Ltd., says small rural gas stations with high distribution costs can't make money under a fixed-price system, and are being squeezed out of the market.

"The New Brunswick government didn't really take the time to sit down with the stakeholders to find out how the industry functions," he said.