Gas Prices Surpass Post-Katrina Highs

Gas prices over $3.00 per gallon are seen on display at a Union 76 gas station March 7, 2007 in San Francisco, California. Getty Images

Gasoline prices hit a new record at the pump on Monday, but gas futures prices fell on concerns that $3 gas will crimp demand.

Oil prices, meanwhile, rose on reports of refinery problems in the U.S. and abroad.

The average national price of a gallon of gas hit $3.073 on Monday, up almost a penny from Sunday's also record-setting price, according to AAA and the Oil Price Information Service. Gasoline is now well above the previous record of $3.057, set on Sept. 5, 2005, soon after Hurricane Katrina.

But gasoline futures for June delivery fell 5.09 cents to settle at $2.3012 on the New York Mercantile Exchange. Light, sweet crude for June delivery rose 9 cents to settle at $62.46 a barrel on the Nymex.

Heating oil futures fell 1.55 cents to settle at $1.8668 per gallon on the Nymex, while natural gas prices gained 5.3 cents to settle at $7.952 per 1,000 cubic feet.

Brent crude for June settled unchanged at $66.83 a barrel on the ICE Futures exchange in London.

Chip Hodge, energy portfolio manager at John Hancock Financial Securities, in Boston, thinks gasoline futures traders may be reacting psychologically to the fact that pump prices are setting new records.

"You just get a feeling that $3 a gallon. ... It's got to have an impact from a demand standpoint," Hodge said. "So, maybe there's a little bit of a selloff on those pressures."

While oil prices rose on the day, they settled well off their earlier highs on news that Chevron Corp. plans to restart a 42,000 barrels-per-day Nigerian oil facility, said Phil Flynn, an analyst at Alaron Trading Corp. in Chicago.

"There was good news out of Nigeria after a lot of bad news," Flynn said. "They're pumping oil again."

But that good news was tempered by new reports of refinery outages, including a fire at a large Preem facility in Sweden and a quickly resolved problem at a Valero Energy Corp. refinery in Texas last week.

"Any refinery problems anywhere on the globe now adds to concerns" that gasoline supplies won't be adequate to meet peak summer driving demand, Flynn said.

The summer driving season begins in two weeks, on Memorial Day weekend. The government reported that gasoline inventories rose slightly last week, but remain low by historical standards.

"Tightness in the U.S. gasoline situation will continue to drive the market ... because the summer driving season is right around the corner," said Victor Shum, energy analyst with Purvin & Gertz in Singapore. "There's not a lot of time for refineries to catch up with demand."

  • Stephen Smith

    Stephen Smith is a senior editor for CBSNews.com

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