Huffpost Business

Gas Prices March Toward $3 Per Gallon

Posted: Updated:

A dime more a gallon may not sound like much, but it adds up to $40 million more out of the driving public's pocket.

The rising price of oil has pushed up gasoline prices. Crude has climbed about 5 percent in the past 10 days, and on Tuesday it topped $90 for the first time in over two years. On Friday, benchmark oil lost 58 cents to settle at $87.79 a barrel on the New York Mercantile Exchange.

The retail price of gasoline could go higher, even if oil prices level off. Gasoline supplies have been affected by unexpected refinery shutdowns in the West and Midwest. "There has been a good deal of unscheduled maintenance recently, and that has made ... gasoline markets nervous," energy consultants Cameron Hanover said.

Analyst Phil Flynn with PFGBest in Chicago said the shutdown of a refinery in St. Croix, Virgin Islands, contributed to tight supplies on the East Coast, which could add a couple of cents a gallon to gas prices there.

Oil and gasoline prices are unlikely to fall significantly if demand picks up. On Friday The International Energy Agency raised its forecast for global oil demand for this year and 2011. IEA, based in Paris, thinks consumption in North America and emerging Asian countries, especially China, will be greater than it previously expected. If that happens, IEA said OPEC could boost supplies as prices rise. In 2008, OPEC raised production levels as oil shot past $100, on its way to a record $147 a barrel.

The Organization of Oil Exporting Countries meets this weekend in Ecuador. "Pre-meeting statements by OPEC ministers suggest the group is planning on a quick agreement to roll over existing output targets," IEA said.

In other trading on the Nymex, heating oil fell 0.93 cent to settle $2.4575 a gallon, gasoline gave up 3.12 cents to settle at $2.3093 a gallon and natural gas dropped 1.8 cents to settle at $4.417 per 1,000 cubic feet.

In London, Brent crude fell 51 cents to settle at $90.48 a barrel on the ICE Futures exchange.