Average gas prices top $4 per gallon on LI

Gasoline prices surpassed $4 a gallon on Long Island Monday for the first time since early June, following crude oil upward on speculation over possible shortages from Middle East unrest.

The AAA, a motorist group, said regular gas averaged $4.011 a gallon in its Monday survey of stations, which was posted at about 3 a.m. Tuesday, up about 9 cents from a week earlier and 29 cents from a month earlier. Regular nudged $5 a gallon at some stations, where midgrade and premium exceeded that.

Heating oil also continued to rise, jumping another 5.8 cents in the week ended Monday, to an average of $4.30 a gallon at full service Long Island dealers, the state Energy Research and Development Authority said.

Experts said gasoline prices might rise further in coming weeks from temporary shortfalls as refineries switch over to more expensive summer fuel required by clean air laws. Beyond that, however, prices will fluctuate with diplomatic tensions, now high, over Iran's growing nuclear capability and its threats to disrupt shipping in the region in response to economic sanctions against it by the West.

"If Iran comes to the table and agrees to negotiate -- even if nothing ever gets accomplished -- I think the market will start easing a little bit," said Dominick Chirichella, senior partner at the Energy Management Institute in Manhattan, an education and publishing company that has a futures trading operation.

Monday's average gasoline price was below the Island's record of $4.346 a gallon set July 8, 2008. But prices at some stations have passed even that mark. The website longislandgasprices.com, based on motorist reports, showed regular Tuesday ranging from $3.79 a gallon at four locations in Farmingdale to $4.99 at five Gulf Stations in both counties. Right behind them were six Mobil stations with regular at $4.95.

Massachusetts-based Cumberland Farms Inc., owner of Gulfs in the Northeast since 1986, had no one available to comment Tuesday, a spokesman said. The company has said in the past that prices are set by independent station operators. No laws restrict what gasoline stations can charge. The state attorney general's office said higher-than-average prices can be considered "gouging" only if there is an event, such as a natural disaster, that creates a shortage.

Price increases since the beginning of this year have led to declines in demand.MasterCard Inc. says Americans bought almost 7percent less gasoline last week than a year earlier.

U.S. crude oil futures have risen from a recent low in early February of $96.36 a barrel to settle as high recently as $109.77 a barrel, on Feb. 24. European crude oil, used to produce much of the gasoline consumed on the East Coast, typically costs $15 to $20 more.