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Gas Prices Rise Above $2.50 a Gallon

Associated Press | March 21, 2006

The average retail price of gasoline soared by almost 14 cents last week, rising above $2.50 a gallon for the first time since late October.

The federal Energy Information Administration said Monday that U.S. motorists paid $2.504 cents a gallon on average for regular grade last week, a rise of 13.8 cents from the previous week. Pump prices are still 39.5 cents higher than a year ago.

The jump in retail prices follows a 42-cent-per gallon rise in unleaded gasoline futures since mid-February. On Monday, gasoline for April delivery settled at $1.8301 per gallon.

Average retail prices peaked at $3.07 a gallon in early September, a reflection of the extreme tightness in the market following Hurricane Katrina, which knocked out refineries in the Gulf region, as well as pipelines that deliver fuel to the East Coast and Midwest.

Gasoline prices were most expensive last week on the West Coast, averaging $2.571 per gallon, and cheapest in the Rocky Mountain region, averaging $2.395 per gallon.

One of the key factors underpinning the high price of gasoline is the cost of crude oil, which has been elevated by strong demand, tight global supplies and geopolitical uncertainties.

Crude-oil futures settled Monday at $60.42 on the New York Mercantile Exchange. That is about 7 percent higher than a year ago.

 

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