U.S. Gas Prices up 14 Cents in 3 Weeks

The average price of regular gasoline in the United States is up 14 cents over a three-week period to $2.74.

That's according to the national Lundberg Survey of fuel prices released Sunday.

Analyst Trilby Lundberg says the average price for a gallon of mid-grade was $2.86. Premium was at $2.97.

Cheyenne, Wyo., had the lowest average price among cities surveyed at $2.36 a gallon for regular. Anchorage was the highest at $3.28.

In California, prices were also up 14 cents since Dec. 18. A gallon of regular cost an average of $3.02.

Fresno had the state's least expensive gas at $2.90 a gallon. San Francisco remained the steepest at $3.06.

Meanwhile, the Obama administration will announce on Monday funding for nine projects designed to significantly increase fuel efficiency in heavy trucks and passenger vehicles, with more than half the money coming from the $787 billion stimulus package.

Energy Secretary Stephen Chu will detail the projects during a ceremony in Columbus, Ind., home of Cummins Inc., which is to receive nearly $40 million to develop a more efficient and cleaner diesel engine, a more aerodynamic long-haul truck cab and trailer, and a fuel cell that would deliver auxiliary power to reduce engine idling while the vehicle was not on the road.

The White House said the nine projects would receive $187 million from the federal government, with more than $100 million coming from stimulus funds and the remainder from DOE appropriations. Recipients are expected to match government funding, creating a total investment of $375 million in the projects.

According to the administration, the nine recipients are expected to create more than 500 research, engineering and management jobs, with 6,000 more positions anticipated when the technologies go into production and assembly.

In detailing the project awards, the administration said the new technologies, when in broad use, "could save more than 100 million gallons of oil per day and reduce carbon emissions from on-road vehicles by 20 percent by 2030."

Three of the projects, receiving $115 million, are aimed at improving long-haul truck fuel efficiency by 50 percent, with new designs to be ready by 2015.

In additions to Cummins, Daimler Trucks North America LLC, of Portland, Ore., will receive nearly $40 million; Navistar Inc., of Fort Wayne, Ind., is in line for $27.3 million.

The remaining six projects for passenger vehicles will spread more than $71 million among Chrysler, Ford, General Motors, Delphi Automotive Systems, Robert Bosch and a second Cummins project.

The money will go to companies based in economically hard-hit Michigan and Indiana, with the exception of Daimler Trucks.

On Monday, oil prices jumped above $83 a barrel amid signs of strong Chinese demand for crude, a weakening U.S. dollar and a strong flow of speculative funds into commodities.

By early afternoon in Europe, benchmark crude for February delivery was up $1.09 to $83.84 a barrel in electronic trading on the New York Mercantile Exchange. On Friday, the contract rose 9 cents to settle at $82.75.

China said Sunday that oil imports rose 14 percent last year to a record high in December, part of a 56 percent surge in overall imports last month. The better than expected Chinese figures helped investors brush off Friday's disappointing U.S. jobless report, which showed the economy lost 85,000 jobs in December and the unemployment rate was steady at 10 percent.

A weaker dollar also helped boost oil prices, as investors buy commodities as a hedge against inflation while crude priced in dollars becomes cheaper in other currencies.

The euro rose to $1.4522 on Monday from $1.4430 on Friday while the British pound advanced to $1.6163 from $1.6032 and the dollar fell to 92.39 Japanese yen from 92.64 yen.

Crude prices have spiked 20 percent in the last month as a rash of cold winter weather in parts of the U.S., Europe and Asia boost demand for oil products such as heating oil.

Amplifying the effects of the frigid climate was a surge into commodities of speculative money with little regard for the basics of supply and demand.

"Investors might be overvaluing and thereby multiplying the impact of cold temperatures," said JBC Energy in Vienna. "To make a significant impact the chilly weather will have to remain with us for months and not weeks."

Analysts at Britain's KBC Market Services said that rising oil prices were the result of speculative decisions, not market fundamentals.

"If prices continue to rise next week, it will be tempting to conclude that we are back in the casino-like oil market conditions we saw in 2008," KBC said in a report. Oil hit a record high of $147 a barrel in July 2008.

Supplies were threatened in Nigeria, where unidentified gunmen attacked a Chevron Corp. crude oil pipeline, cutting production by 20,000 barrels a day, a company spokesman said Saturday.

"While this highlights that Nigeria is still a volatile environment, we are not back to the previous scheme of militancy," said Olivier Jakob of Petromatrix in Switzerland.

In other Nymex trading in February contracts, heating oil rose 2.66 cents to $2.2269 a gallon and gasoline gained 3.58 cents to $2.1911 a gallon. Natural gas futures were down 19.1 cents to $5.558 per 1,000 cubic feet.

In London, Brent crude for February delivery rose 99 cents to $82.32 a barrel on the ICE Futures exchange.