Dec. 24 (Bloomberg) -- Gasoline at U.S. service stations dropped to the lowest level in a year as refining and retail margins sank, according to Lundberg Survey Inc.
The average price for regular gasoline at U.S. pumps fell 11.72 cents in the two weeks ended Dec. 21 to $3.2579 a gallon, extending its decline to almost three consecutive months, the survey of about 2,500 stations by the Camarillo, California-based company showed. The average, now the lowest since Dec. 16, 2011, has retreated 57.96 cents a gallon over the past 11 weeks and is 70.92 cents below the year-to-date high of $3.9671 on April 6.
“This is the end of the price crash,” Trilby Lundberg, president of Lundberg Survey, said in a telephone interview yesterday, predicting U.S. pump prices may rise 5 cents to 10 cents a gallon over the next few days as refiners and gasoline retailers seek to widen margins that declined to the lowest since February and August, respectively. “Both of these downstream sectors will need to try to recover some of that lost gasoline margin in the near future.”
U.S. gasoline inventories increased by 2.2 million barrels in the week ended Dec. 14 to 219.3 million barrels, the highest level since March 30, Energy Department data show. Supplies have jumped almost 19 million barrels in the past month as refiners processed more than 700,000 barrels a day more crude and other feedstocks.
Gasoline futures on the New York Mercantile Exchange rose 13.73 cents, or 5.3 percent, to $2.7347 a gallon in the past two weeks. Futures have dropped 20 percent since reaching a year-to-date high of $3.4166 on March 26. Prices are up 1.8 percent this year.
West Texas Intermediate crude futures on the Nymex gained $2.73, or 3.2 percent, to $88.66 a barrel in the two weeks to Dec. 21. Prices have fallen 10 percent in 2012.
Oil may advance next week as stronger demand for fuels reduces inventories, a Bloomberg survey showed. Twelve of 31 analysts, or 39 percent, forecast crude will rise through Dec. 28. Eleven respondents, or 36 percent, predicted a drop. Eight forecast little change. Last week, 39 percent of analysts projected a decline.
“What retail gasoline prices do next will depend mostly on what crude oil does,” Lundberg said.
Regular gasoline on Long Island averaged $3.75 a gallon, down 10.59 cents since the last survey on Dec. 7, Lundberg said. Los Angeles-area retail stations averaged $3.55.
The highest price in the lower 48 U.S. states among markets surveyed was on Long Island. The lowest price was in Tucson, Arizona, where customers paid an average of $2.90 a gallon.
The Lundberg survey is typically compiled every two weeks.
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