Chances for gas pump price breaks appear slim

The chances for late-summer discounts at the gas pump are looking pretty slim.

Americans
are paying about 15 cents more for a gallon of gas now than they did
over the July Fourth weekend and nearly $1 more than a year ago. The
national average for a gallon of regular was $3.695 a gallon Friday, up
0.6 cent overnight, according to AAA, Wright Express and the Oil Price
Information Service.

In a rare twist, California drivers aren’t
paying the highest prices in the lower 48 states. That unwelcome
distinction belongs to the Northeast. Refinery and import issues have
tightened supplies there, while gas is more plentiful in California,
according to Fred Rozell, retail pricing director at OPIS.

California
drivers paid an average of $3.813 a gallon on Friday. Motorists paid
$4.036 a gallon in Connecticut and $3.944 in New York. Prices in Hawaii
and Alaska still top $4 a gallon. The cheapest prices were in the Rocky
Mountains, Mississippi and parts of the Midwest.

Analysts expect
gas prices to be fairly consistent in the next few months, barring a
hurricane that threatens Gulf Coast refinery operations or significant
economic news affecting the price of oil, Rozell thinks pump prices will
remain in a narrow range for the rest of the year before they climb
again next spring.

Oil prices were a little higher at midday
Friday as U.S. lawmakers continued to debate spending plans and raising
the nation’s debt ceiling. Failure to raise the limit by the Aug 2
deadline means the U.S. would default on its debt.

Benchmark West
Texas Intermediate crude rose 69 cents to $99.82 a barrel on the New
York Mercantile Exchange. Brent crude gained 96 cents at $118.47 per
barrel on the ICE Futures exchange in London.

Investors worry that
failure to resolve debt problems in the U.S. and Europe could cause the
global economy to slow, and cut demand for commodities such as oil.

Fitch
ratings agency said Greece will be in default on its debt as a result
of a new bailout plan crafted by European leaders that asks investors to
take losses on the country’s bonds.

Debt issues on both
continents have “played havoc with the price of oil in recent weeks,”
PFG analyst Phil Flynn said. Since the beginning of the month, the price
of oil has ranged from about $94 a barrel to just over $100.

The
dollar has contributed to oil’s volatility. It’s been up and down
against major currencies this month. Oil, like most commodities, is
priced in dollars. If the dollar weakens, oil becomes more of a bargain
for investors who use other currencies and the price tends to rise.

In
Friday trading for other Nymex contracts, heating oil rose 4 cents to
$3.1482 per gallon, gasoline futures gained 3 cents at $3.0870 per
gallon and natural gas rose 2 cents to $4.377 per 1,000 cubic feet.

 

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