Bill
04-05-2008, 11:44 PM
That's good news.
http://www.msnbc.msn.com/id/12400801/
NEW YORK - Retail gas prices surged to a new record above $3.30 a gallon Friday and appear poised to rise further in coming weeks as gasoline supplies tighten.
Oil prices, meanwhile, supported the gas price rally by jumping more than $2 a barrel after a dismal employment report sent the dollar lower.
At the pump, gas prices rose 1.4 cents overnight to a national average of $3.303 a gallon, according to AAA and the Oil Price Information Service. That’s the latest in a series of records, and about 60 cents higher than a year ago.
While oil’s surge above $100 over the last month has boosted gas prices so far this year, analysts now expect gas prices to continue rising regardless of what direction crude takes. The Energy Department expects prices to peak near $3.50 a gallon later in the spring, but many analysts predict the spike could approach $4.
That’s because gasoline supplies are falling, in part because producers are cutting back on output of the fuel due to the high cost of crude — the more expensive crude is, the more refiners have to pay and the lower their profits are. They’re also in the process of switching over from producing winter grades of gasoline to the less polluting but more expensive grade of fuel they’re required to sell in the summer.
“That cuts back on some of the supply and helps to pump up the price,” said Mike Pina, a spokesman for AAA.
The margin between the price refiners pay for crude and receive for selling the products they make from it is around $11 to $12 a barrel right now, according to the Oil Price Information Service. However, that margin has occasionally slipped into negative territory in recent weeks and is well below margins of $37 a barrel refiners earned last spring.
On Thursday, ConocoPhillips said high crude prices were significantly hurting its refining margins. Last week, Valero Energy Corp. cut output at its Corpus Christi, Texas, refinery due to high supplies and falling demand. Analysts believe many other refiners are adopting similar tactics.
Friday’s price spike is a sign those cutbacks may be working, giving everyone in the supply chain, from refiners to retailers, the ability to raise prices to try to boost margins. Many gas retailers say they make more on the sale of coffee and sundries in their convenience stores than from selling gasoline.
http://www.msnbc.msn.com/id/12400801/
NEW YORK - Retail gas prices surged to a new record above $3.30 a gallon Friday and appear poised to rise further in coming weeks as gasoline supplies tighten.
Oil prices, meanwhile, supported the gas price rally by jumping more than $2 a barrel after a dismal employment report sent the dollar lower.
At the pump, gas prices rose 1.4 cents overnight to a national average of $3.303 a gallon, according to AAA and the Oil Price Information Service. That’s the latest in a series of records, and about 60 cents higher than a year ago.
While oil’s surge above $100 over the last month has boosted gas prices so far this year, analysts now expect gas prices to continue rising regardless of what direction crude takes. The Energy Department expects prices to peak near $3.50 a gallon later in the spring, but many analysts predict the spike could approach $4.
That’s because gasoline supplies are falling, in part because producers are cutting back on output of the fuel due to the high cost of crude — the more expensive crude is, the more refiners have to pay and the lower their profits are. They’re also in the process of switching over from producing winter grades of gasoline to the less polluting but more expensive grade of fuel they’re required to sell in the summer.
“That cuts back on some of the supply and helps to pump up the price,” said Mike Pina, a spokesman for AAA.
The margin between the price refiners pay for crude and receive for selling the products they make from it is around $11 to $12 a barrel right now, according to the Oil Price Information Service. However, that margin has occasionally slipped into negative territory in recent weeks and is well below margins of $37 a barrel refiners earned last spring.
On Thursday, ConocoPhillips said high crude prices were significantly hurting its refining margins. Last week, Valero Energy Corp. cut output at its Corpus Christi, Texas, refinery due to high supplies and falling demand. Analysts believe many other refiners are adopting similar tactics.
Friday’s price spike is a sign those cutbacks may be working, giving everyone in the supply chain, from refiners to retailers, the ability to raise prices to try to boost margins. Many gas retailers say they make more on the sale of coffee and sundries in their convenience stores than from selling gasoline.