Gas Prices Up 4 Cents a Gallon in a Week

WASHINGTON – The average U.S. retail price of gasoline jumped by 4 cents last week to $2.95 a gallon.

The federal Energy Information Administration said Monday that U.S. motorists paid $2.947 a gallon on average for regular grade last week, an increase of 3.8 cents from the previous week. Pump prices are 78.4 cents higher than a year ago.

Average retail gasoline prices peaked at $3.07 a gallon last September, reflecting the extreme tightness in the market following Hurricane Katrina, which knocked out refineries in the Gulf region as well as pipelines that deliver fuel to the East Coast and Midwest.

Gasoline prices were most expensive last week on the West Coast, averaging $3.25 per gallon, and cheapest in the Gulf Coast region, averaging $2.832 per gallon.

One of the key factors underpinning the high price of gasoline is the cost of crude oil, which has been elevated by strong demand, tight global supplies and geopolitical uncertainties.

The usual pre-summer gasoline supply worries are heightened this year by the prospect of tight supplies of ethanol, which is needed in increasing amounts now that refiners have phased out their use of an additive called methyl tertiary butyl ether, or MTBE, which has been found to contaminate drinking water.

Crude-oil futures settled Monday of $69.41 on the New York Mercantile Exchange, following a decline of $2.63. Gasoline futures closed at $2.054 per gallon, a decline of 12.45 cents.