Gasoline prices have risen versus last week in every section of the U.S. besides the Midwest. Nationally, the price of a gallon of gas has climbed 1% in the past week and 13% in the past month, outpacing the 3% drop in the price of WTI crude and the 2% rise in Brent crude.

Period

Regular

WTI Crude

Brent Crude

2/25/2013

$3.782

$92.93

$113.87

Week Ago

$3.748

$96.69

$117.04

Month Ago

$3.347

$95.61

$111.71

Year Ago

$3.698

$109.39

$124.89

Source: U.S. EIA.

Seasonally, we're seeing the highest price of gasoline in the fourth week of February in the past five years.


Regionally, gas prices vary quite a bit, with California having the highest prices.

And so the obvious question is: Why is gas so high now?

There are three big reasons.

1. Refinery outages. Many refineries do necessary maintenance in the winter months, as demand is the lowest. However, there are a few unplanned refinery outages, and Hess is closing its 70,000 bbl/d Port Reading refinery, which has lost money the past three years.

2. Prior low crack spreads. Earlier in the winter, crack spreads for Brent crude fell below 0, meaning refiners were losing money for every gallon of gasoline they produced.

This situation has now reversed itself.

3. Global demand for petroleum products. While demand for gasoline in the U.S. has been flat, around the world demand is growing. For structural reasons, the price of oil in the U.S. (WTI) is almost $20 cheaper than the international price. While Enterprise Product Partners and Enbridge are busy reversing the Seaway Pipeline and TransCanada is halfway done with its pipeline from Cushing, Okla., to the Gulf Coast, Marathon Petroleum, Valero Energy, and Phillips 66 have all been taking advantage of the price disparity by exporting gasoline and other forms of processed crude oil. Exports for gasoline were at their highest levels in U.S. history in December. We'll have to wait till March 7 for the January numbers, but I expect those to be even higher.

Profit from the boom in U.S. oil and gas
It's easy to forget the necessity of midstream operators that seamlessly transport oil and gas throughout the United States. Kinder Morgan is one of these operators, and one that investors should commit to memory because of its sheer size -- it's the fourth largest energy company in the U.S. -- not to mention its enormous potential for profits. In The Motley Fool's new premium research report on Kinder Morgan, our top energy analyst breaks down the company's growing opportunity, as well as the risks to watch out for, to uncover whether it's a buy or a sell. To determine whether this dividend giant is right for your portfolio, simply click here now to claim your copy of this invaluable investor's resource. As a bonus, you'll receive a full year of key updates and guidance as news develops, so don't miss out!

The article Why Are Gas Prices Rising in February? originally appeared on Fool.com.

Find Dan Dzombak on Twitter , @DanDzombak, or on his Facebook page, DanDzombak. He has no position in any stocks mentioned. The Motley Fool recommends Enterprise Products Partners and Kinder Morgan and owns shares of Kinder Morgan. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.


Increase your money and finance knowledge from home

Introduction to Value Investing

Are you the next Warren Buffett?

View Course »

Investing Like Warren Buffett

Learn from one of the world's best investors.

View Course »

Add a Comment

*0 / 3000 Character Maximum