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Gas prices rise as summer driving peaks

Monday, June 28, 2010 | 5:54 p.m. CDT

Gasoline prices continue to rise Monday as vacationers in RVs and campers join commuters on the roads during the peak summer driving season.

Pump prices likely will increase over the next couple of weeks but fall short of $3 per gallon in most states. Analysts note that demand remains lackluster while supplies are ample. And consumers worried about the economy may keep traveling to a minimum.

The national average for retail gasoline prices rose 0.1 cent to $2.756 a gallon Monday, according to Wright Express and Oil Price Information Service. That's an increase of 1.9 cents from a week ago and 11.3 cents from a year ago.

Western states tend to have higher prices. Gas is averaging $3.141 a gallon in California; $2.904 a gallon in Idaho and $2.997 in the state of Washington.

Among those states with the lowest prices were Missouri at $2.562 a gallon; Mississippi, $2.556 a gallon; and Tennessee, $2.585 a gallon.

Oil prices fell slightly after it appeared Tropical Storm Alex would strengthen but stay out of the Gulf region where most oil rigs and refineries are located, and where BP continues to try to stop a massive oil leak.

"The crude market is not particularly tight right now so weather-related production outages will not have the same effect as in years past unless they reach 'Katrina' levels," MF Global analyst Mike Fitzpatrick said in a research note.

"Prices, will however, be sensitive to economic data flow, particularly with respect to the economy," he wrote.

Benchmark crude for July delivery fell 61 cents to settle at $78.25 a barrel on the New York Mercantile Exchange.

Oil analyst and trader Stephen Schork predicted oil prices would trade in a narrow range this week ahead of the Fourth of July holiday.

The dollar also grew stronger against other global currencies, which can hurt commodities trading. Most commodities are priced in dollars so a stronger dollar makes them less appealing to foreign investors.

In other Nymex trading in July contracts, heating oil fell 1.89 cents to $2.0933 a gallon, gasoline dropped 3.02 cents to $2.1376 a gallon and natural gas was down 14.4 cents at $4.717 per 1,000 cubic feet.

In London, Brent crude fell 53 cents to $77.59 a barrel on the ICE futures exchange.


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