Price of gas hits August record

You may pay more than ever for a late-summer drive.

U.S. drivers paid an average of $3.72 per gallon on Monday. That’s the highest price ever on this date, according to auto club AAA, a shade above the $3.717 average on Aug. 20, 2008. A year ago, the average was $3.578.

More daily records are likely over the next few weeks. The national average could increase to $3.75 per gallon by Labor Day, said Tom Kloza, chief oil analyst at Oil Price Information Service. By comparison, gas prices stayed below $3.70 in late August and early September in both 2008 and 2011.

Kloza and other analysts expect prices to start dropping after Labor Day, so drivers shouldn’t have to worry about a return to the April high of $3.94 per gallon, barring a hurricane or other unforeseen event.

Retail gasoline prices have risen nearly 12 percent since July 1. because of higher oil prices, and problems with refineries and pipelines that created temporary supply shortages in some regions. An increase in the price of ethanol, which is blended into gasoline, also contributed to the rise in pump prices.

Higher gas prices aren’t what the sluggish economy needs, since any extra money that goes to fill gas tanks doesn’t get spent at movie theaters or restaurants.

The pace of the increases has slowed considerably, however. Gas rose 19 cents in the two weeks ended Wednesday. It’s up just 1 penny in the five days since. Gas costs about 26 cents more than a month ago and 14 cents more than a year ago, according to AAA, OPIS and Wright Express.

Across the U.S., prices range from a low of $3.43 per gallon in South Carolina to $4.32 in Hawaii. Arizona, Mississippi and New Mexico also have average prices below $3.50 per gallon, while California and Illinois are up above the $4 mark.

A few drivers are catching a break. Kloza said gas prices are lower than this date in 2011 in four states – Montana, Wyoming, Utah and Idaho.

The price at the pump in the U.S. fell more than 60 cents per gallon during the spring as the global economy slowed and turmoil in the Middle East seemed to subside.

But crude oil has risen above $95 a barrel from a low of $78 in late June. Investors have worried about disruption to oil supplies in the Middle East and North Sea. In the U.S., there were problems with refineries and pipelines in the West Coast and Midwest, including a fire in California. Seasonal factors are also at play: Summer blends of gas cost more and demand goes up as families go on vacation.

Gas hit an all-time high of $4.11 per gallon in July 2008. But a plunge in oil prices knocked it down to $3.69 by the end of August. Though the national average jumped back to $3.85 in mid-September when Hurricane Ike hit the Gulf Coast, it plummeted to $1.62 per gallon by year-end as the global recession took hold.

On Monday, oil fell in New York trading after four days of gains on more concerns about Europe’s economy. European leaders are beginning a series of discussions that could determine Greece’s future and the stability of the 17 countries that use the euro.

Benchmark oil dropped 36 cents to $95.65 per barrel in New York. Brent crude, which is used to price international varieties of oil, dropped 10 cents to $113.63 per barrel in London.

Other futures prices on the New York Mercantile Exchange:

• Heating oil increased was flat at $3.09 per gallon.
• Wholesale gasoline rose 1 cent to $3.04 per gallon.
• Natural gas rose 5 cents to $2.77 per 1,000 cubic feet.

 

CBS