Gasoline supply rises, prices drop

U.S. drivers found more relief at the pump as the retail price for gasoline fell 8.2 cents over the last week to an average of $2.876 a gallon nationwide and dropped 5.8 cents to $3.06 a gallon in California, the government said Monday.

The national price for regular gasoline is down 17 cents in the last two weeks and almost 13 cents lower than a year earlier, the federal Energy Information Administration said in its weekly survey of service stations. California’s average gasoline price is nearly 14 cents lower than a year earlier.

Pump prices are the lowest since mid-April, following an increase in gasoline supplies after more oil refineries came back online from maintenance and boosted production. Retail prices often fall in the middle of the summer before ticking higher again around Labor Day.

“We’re in that kind of midsummer swoon,” said Kevin Saville, managing editor of the Americas energy desk at Platts, the energy research unit of McGraw-Hill Cos.

The latest data from the Energy Department’s analytical arm shows U.S. gasoline inventories increased 800,000 barrels to 204.1 million barrels for the week ended July 20. That left inventories 3% below the five-year average, compared with a 3.7% deficit the previous week.

In the Energy Information Administration’s new weekly gasoline price survey, fuel was the most expensive on the West Coast, down 5.4 cents to $2.997 a gallon. Among major cities, San Francisco had the highest gasoline costs at $3.179 a gallon, down 5.5 cents.

The Gulf Coast states had the lowest price by region at $2.792 a gallon, down 7.5 cents.

Cleveland had the cheapest pump price at $2.629 a gallon, down 20 cents.

Separately, the average price truckers paid for diesel fell 0.3 of a cent to $2.886 a gallon.

The West Coast had the most expensive diesel at $3.058, down 0.3 of a cent. The lower Atlantic states had the most affordable at $2.806, down almost a penny.

In New York futures trading, oil retreated Monday from an 11-month high, following gasoline futures lower on word that refineries in New Jersey and England were restarting.

Light, sweet crude for September delivery fell 19 cents to settle at $76.83 a barrel on the New York Mercantile Exchange after rising more than $2 on Friday to $77.02, a cent shy of its July 2006 record close. Traders managed to push oil prices to an 11-month intraday high of $77.33 Monday in a short-lived rally that analysts said was fueled by technical buying.

Gasoline for August delivery fell by 1.61 cents Monday to $2.0856 a gallon on the New York Mercantile Exchange.