April 9, 2010
Gasoline prices rose quickly this week, along with the price of crude oil. The national average price of self-serve regular today is $2.862 a gallon, up five cents from last Friday, according to AAA.
The price of diesel fuel has broken the $3 a gallon mark, to $3.042 a gallon, an increase of nine cents.
Prices at the pump appear to be chasing the price of crude oil higher. Oil prices surged to new highs for the year to open the week, largely riding a renewed wave of optimism on the economy which has fed investor hopes for improving demand for oil and gasoline.
Oil traders became more bullish after the March employment data showed the economy added 162,000 jobs during the month. Figuring an improving economy will eventually need more oil, traders bought oil futures contracts, bidding up the price of oil.
Oil prices are now at their highest levels since October 2008, when prices were falling from their stratospheric highs reached the previous July. But high prices then and high prices now appear to have two very different causes.
"The most important differences in today's oil markets are the issues of oil supply and demand," said Andrew Delmege, AAA's manager of regulatory affairs. "In 2008, many analysts suggested that existing oil supplies were being stretched thin by spiking international demand in India and China. This year, supplies remain plentiful with significant additional capacity for both oil and gasoline production available to be accessed in the event of an increase in demand. Consumer demand for gasoline hasn't changed in a meaningful way, as evidenced by the fact refiners continue to run at about 80 percent capacity."
