Prepare for Pain at the Pump as Oil Prices Head Higher

AAA says prepare for higher pump prices
Justin Sullivan/Getty Images
NEW YORK -- The price of oil rose Thursday as a positive report on the U.S. labor market and more cold temperatures boosted expectations of higher demand for fuel.

Meanwhile, the auto group AAA reminded drivers that spring is on the way -- and along with it, higher gasoline prices.

Benchmark U.S. crude for March delivery rose 46 cents to close at $97.84 a barrel on the New York Mercantile Exchange, after earlier rising near $99.

The Labor Department said the number of people applying for unemployment benefits declined 20,000 last week to 331,000, suggesting that Americans are facing fewer layoffs and better job prospects. Those figures came a day before a widely anticipated report on January employment.

With chilly temperatures across the middle of the country and into the Northeast, demand for heating oil remains strong. That should boost refineries' need for crude oil.

The cool weather has had the opposite effect on gasoline demand: drivers hunkering down in their homes don't use the car. The average price for a gallon of gas in the U.S. is $3.27, down 5 cents from Jan. 1.

Still, AAA said Thursday that gasoline prices will soon be on their way up. Refineries are starting to shut down for winter maintenance, which reduces supply. They also gradually switch to more expensive summer blends of gasoline over the coming weeks.

"Winter weather, weak demand and sufficient supplies have kept gas prices relatively low recently, but this trend may not last much longer," said Bob Darbelnet, president and CEO of AAA.

This rise in price happens nearly every spring.
This year, AAA predicts the nationwide average price will peak between $3.55 and $3.75 a gallon, lower than last year's high of $3.79, reached on Feb. 27. Right now, gas is on average 28 cents cheaper than at this time last year.

For all of 2014, AAA expects the nationwide average to be at least five cents cheaper than last year's $3.49.

Natural gas prices were volatile again. The price rose 7 percent to $5.40 per 1,000 cubic feet in the morning, but then fell sharply. The Energy Department said the nation's supply of natural gas dropped by 2.62 billion cubic feet last week. But analysts were expecting a decline of at least 273 billion cubic feet, according to Platts. Natural gas futures fell 10 cents to close at $4.83 per 1,000 cubic feet.

Brent crude, a benchmark for oil sold internationally, gained 94 cents to $107.19 on the ICE exchange in London.

In other energy futures trading on Nymex:
  • Wholesale gasoline gained 4 cents to $2.68 a gallon.
  • Heating oil was flat at $3 a gallon.

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skcarcomed_0

Alwaysseekingahandoutfrom4u
Dicky,..you need to stop hoarding government cheese logs. Did you look for a job today ? Notice conservatives don't have a agenda because their too busy acting like children.

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Did you post another lie today about having a job working for Aramark. Like Obama you have no credibility.

February 08 2014 at 9:21 AM Report abuse rate up rate down Reply
skcarcomed_0

Neverseekingthetruth4u
How about we build a refinery in your back yard ? I live not to far from the BP refinery in Northwest Indiana. When I drive through Whiting Indiana where the Refinery is located I can\'t believe people actually live here. It smells really bad here and the BP refinery has been in trouble with the EPA for dumping toxic waste into lake Michigan.

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Is that on your way when you\'re driving the truck for Aramark fixing vending machines? You do work there don\'t you?

February 07 2014 at 2:03 PM Report abuse +2 rate up rate down Reply
skcarcomed_0

PHILL AND TRISHA
if the additional xl pipeline section gets approved..the Koch brothers will have won the war against the people of the u.s.,,,i cant wait to hear what excuse they use when a pipeline bursts and floods our precious farmlands and underground water supplys....

...want to bet they pay some piddly fine?

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Another two fear mongering Obamites who both have koch(kock) obsessions.

February 07 2014 at 2:00 PM Report abuse +1 rate up rate down Reply
100 DOLLAR BILL

sick of these greedy oil criminals !

February 07 2014 at 10:31 AM Report abuse +2 rate up rate down Reply
SPQR

We need more bycycles !

February 07 2014 at 9:41 AM Report abuse +4 rate up rate down Reply
Buzzy

It's all just a scam, refiners, speculators, oil companies all working to keep prices high, even though there is a glut of crude oil. And the Keystone pipeline will do nothing for U.S., that oil is headed to the gulf and then to overseas markets.

February 07 2014 at 9:39 AM Report abuse +6 rate up rate down Reply
1 reply to Buzzy's comment
mily469

oh no there is a benefit for the us. we get the sludge left from the refining process, called pet coke (as in the brothers who directly profit from the garbage). they then get to sell the highly sulfuric and lead infused sludge to china to burn and drift back over the planet. and it makes our trade deficit look better.

February 07 2014 at 11:15 AM Report abuse -3 rate up rate down Reply
pdbliz

A Black Man,,,,who is a good friend of mine told me years ago.....
The trouble with the White Man is,,,,,,THEY WILL NOT STICK TOGETHER...
HE SAID,,BLACK PEOPLE WILL STICK TOGETHER EVEN IF THEY DISAGREE WITH EACH OTHER..............pont being made......
America can do something about high prices,,,,,cut back on driving,,,,and ect,,,,Show government,,we mean business also.!!!!!
ALL A GOVERMENT SHAM,,,,,,,,,PLENTY OF OIL HERE,,,,,,COAL AND OTHER ENERGY............THE GREEN PEOPLE ARE DESTROYING AMERICA.!!!!

February 07 2014 at 9:24 AM Report abuse +4 rate up rate down Reply
lsbaylen

Isn't it interesting that just yesterday I read that they are pushing for the ban on oil exports to be lifted?

February 07 2014 at 8:11 AM Report abuse +5 rate up rate down Reply
1 reply to lsbaylen's comment
mily469

we have oil coming out of our ears and we need to drill more? and obviously we have no break at the pump because of it.

February 07 2014 at 8:41 AM Report abuse -1 rate up rate down Reply
k4jlp

OK, So what are you going to do about it besides sit here and type and b i t c h.....?

February 07 2014 at 7:37 AM Report abuse -5 rate up rate down Reply
jmoss111

Buy Exxon stock

February 07 2014 at 7:09 AM Report abuse -3 rate up rate down Reply