Gas prices up; "It's getting ugly"

3:12 PM, Jul 11, 2013   |    comments
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(USA TODAY) - Gas prices are heading up again.

Rising crude oil prices, a fall in U.S. supplies is driving wholesale gas prices up sharply. That has yet to be fully reflected at the retail level.

Prices at the pump - up 4 cents the past week to a national average of $3.52 a gallon - could climb another 15 cents or higher over the next two weeks. A year ago, the national average was $3.38.

"It's getting ugly,'' says Patrick DeHaan, senior analyst for gasbuddy.com. "First and foremost, the political problems in Egypt are driving crude oil prices, but there have also been sharp drop in oil supplies the past two weeks. This is coming at a time when demand is at its annual July peak."

Egypt is not a major oil supplier, but ongoing political woes threaten Middle Eastern shipments and were the catalyst behind crude oil prices rising to 15-month highs earlier this week. Benchmark West Texas crude oil eased 1.7% to $104.73 a barrel in mid-day Thursday trading. Wholesale gas prices, up 30 to 50 cents a gallon on some markets, are now at about $3.02 a gallon for mid-August delivery. Typically, retail prices are about 75 cents higher.

Gas prices have gyrated for much of the year, rising from an average of $3.29 a gallon at the start of 2013 to $3.79 a gallon in February, then falling to $3.47 a gallon last week. In some regions of the Midwest, where supplies were disrupted by oil refinery outages and extended maintenance, prices spiked to $4.25 a gallon.

Midwestern states, including Michigan, Indiana and Ohio, are already experiencing swift, large price hikes, up 16 cents the past week and could rise another 20 cents by this weekend.

"We may be in a rollercoaster for the rest of the summer,'' says DeHaan.

USA TODAY

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