LI gas prices climb for 3rd straight week
Gasoline prices rose for the third straight week on Long Island, by 6.9 cents a gallon in the seven days ended Wednesday.
But supplies are improving and at least two analysts think prices are about to peak.
A gallon of regular unleaded on Long Island averaged $3.878 Wednesday, the AAA said -- almost 25 cents a gallon higher than the recent low of $3.63 on July 2 and 3.
Energy experts have blamed the increases on higher crude oil prices and on tight supplies on the East Coast of summer gasoline, which is required by clean-air laws and is less polluting but difficult to refine.
The shortage arises from the closures late last year of four refineries that supply summer blend "reformulated" gasoline to the region -- two in the Caribbean and two in Pennsylvania. One of the Pennsylvania refineries, in Trainer, has been purchased by Delta Air Lines and is to resume operations after renovations -- but too late to affect gasoline supplies this summer.
But the U.S. Department of Energy reported Wednesday that East Coast supplies of reformulated gasoline rose again last week -- by another 700,000 barrels or 4.5 percent to 16 million barrels. They were still 800,000 barrels or 4.7 percent below a year earlier, but the lag from last year was narrower than the week before.
"That means the price increases are topping out and we'll start to see gas prices level at the pump," said Andy Lipow, president of Houston consulting company Lipow Oil Associates LLC. Analysts say added supplies are coming from refineries in the Gulf of Mexico region and in Europe.
Meanwhile, demand this summer has been soft; U.S. drivers bought 4.4 percent less gasoline last week than they did a year earlier, according to MasterCard. Sander Cohan of the consulting firm Energy Security Analysis Inc. in Wakefield, Mass., attributes that to economic uncertainty and drivers buying more fuel-efficient vehicles. "Summer demand was very slow to emerge this year, and when it did emerge, it wasn't very impressive," he said.
He and Lipow said prices will peak soon and decline slowly through August and into the fall.