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Gas prices set record for fourth day
By SUZETTE PORTER
Article published on Wednesday, May 14, 2008 |
PINELLAS COUNTY – Pump prices climbed almost 3 cents on May 14, setting a record for the fourth day in a row.
According to AAA Auto Club’s Daily Fuel Gauge Report, the price for a gallon of regular unleaded on May 14 was $3.718 – 2.9 cents higher than the day before at $3.689.
Mid-grade unleaded increased to $4.028, up more than 3 cents from yesterday. The pump price for premium was up to $4.102, up from $4.070 on May 13.
Motorist are paying 36 cents a gallon more for a gallon of unleaded than they were a month ago and a little more than 80 cents compared to the same date a year ago.
The price of diesel fuel also set a new record on May 14 at $4.363, up from $4.338 on May 13. A gallon if diesel was selling for $4.055 a month ago and $2.870 on this same date last year.
Randy Bly, director of community relations at AAA Auto Club South said Sunday that gas prices would likely continue to increase all week.
“With oil prices already at record levels and news that the Euro strengthened again against the weakened U.S. Dollar simply adds fuel to the on-going crude oil rally –which for all practical purposes has been going on since the 4th Quarter of 2007, Bly said. “Recent news that militants in Nigeria stepped-up attacks on oil producing facilities and trader’s concerns of future disruption of crude oil supply are also placing upward pressure on crude oil prices. As we will likely see this week, gasoline prices have no other way to go but up.”
According to the federal Energy Information Administration’s This Week in Petroleum report, gas prices will continue to rise as refineries continue production of the more expensive-to-produce summer-grade gasoline.
The latest projections from the EIA show that the wholesale price for May will increase by 10 cents a gallon, inching closer to earlier predictions that gas prices could hit as much as $4 a gallon this summer.
May 1 marked the date when most areas of the United States require the use of summer-grade gasoline, the EIA said.
While the explanation of the differences between winter-grade and summer-grade gas is a bit complicated, the jest of it is that warm temperatures affect the evaporation of gasoline into the atmosphere, leading to increased health problems, more smog and increased levels of ozone.
The culprit is vapor pressure, and gasoline manufacturers and the U.S. Environmental Protection Agency walk a fine line trying to find the perfect mix that reduces the evaporation rate while still allowing for the more efficient operation of gasoline engines.
According to the EIA, the EPA first enforced vapor pressure regulations in 1989 with decreased vapor pressures allowed from May 1 to Sept. 15. The maximum allowable vapor pressure was lowered again in 1992. In 1995, the EPA introduced the reformulated gasoline program, which lowered the allowable levels of vapor pressure even more.
“Gasoline with lower vapor pressure is generally more expensive to produce,” the EIA said. “For example, one method refiners use to reduce vapor pressure is to reduce the volume of normal butane, a liquefied petroleum gas with high vapor pressure, that is blended into gasoline.”
Butane is a lower-cost component of gasoline. Removal of that component increases the production costs.
The EIA released its This Week in Petroleum report on May 14 that said the U.S. average retail price for regular gasoline jumped to yet another all-time high as the price increased by 10.9 cents to 372.2 cents per gallon.
“This was the seventh consecutive week where the price rose, with the cumulative increase totaling 46.3 cents,” the EIA said.
On a regional basis, the EIA said prices increased with the East Coast swelling by 10.3 cents to $3.713 a gallon, some 73.2 cents above the price a year ago. The average price in the Midwest was $3.736 cents a gallon, surging up by 15.7 cents, the largest increase for any region. The average price in the Gulf Coast went up by 10.9 cents to $3.616 cents a gallon.
While the price in the Rocky Mountain region increased by 11.5 cents to $3.609 cents a gallon, the price remained the lowest for any region. The West Coast prices are the highest in the nation but had the smallest increase of any region, moving up by 3.3 cents to $3.833 cents a gallon. The average price in California increased by 1.6 cents to reach $3.919 per gallon.
Registering the third largest one-week increase, according to the EIA, the U.S. average price for diesel reached another new record of $4.331 cents per gallon, up by 18.2 cents this week and 155.8 cents higher than a year ago.
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Article published on Wednesday, May 14, 2008
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