Gas costs creeping up as oil prices fluctuate

Gas prices are headed to $3.50 or more unless oil prices fall.

STAFF/WIRE REPORTS

NEW YORK — Gasoline prices jumped back above $3 a gallon at the pump Monday even as concerns about the economy and increases in crude supplies sent oil prices lower.

Retail gas prices have been slow to catch up with soaring crude prices, which have gained nearly 39 percent since late August to a trading high of $96.24 on Thursday. Gas prices only started rising steadily in mid-October.

The national average price of a gallon of gas rose 1.5 cents overnight to $3.004, and has jumped almost 25 cents in three weeks, according to AAA and the Oil Price Information Service.

The AAA said the average price for regular gas in the Mahoning Valley Monday was $3.027, up from $2.76 a month ago.

The sharp jump in gas prices could continue if oil keeps surging to new heights.

“The consumer has been relatively isolated from these prices,” said Amanda Kurzendoerfer, commodities analyst at Summit Energy Services Inc. in Louisville, Ky.

But, she said, if oil prices don’t retreat, gas prices could reach $3.50 or $4 a gallon by next summer.

Crude, meanwhile, closed lower after an erratic session that saw prices change direction several times.

Energy investors worry that a slowdown in the economy would curb demand for oil and petroleum products.

Light, sweet crude for December delivery fell $1.95 to settle at $93.98 a barrel on the New York Mercantile Exchange Monday.

The International Energy Agency on Monday said global crude oil demand will rise to 98 million barrels a day in 2015 from the 84 million barrels a day now, Dow Jones Newswires reported.

Prices were also pressured Monday by an easing in tensions abroad. Kurdish rebels released eight Turkish soldiers Sunday, moderating concerns about whether Turkey will launch attacks on guerrilla bases in northern Iraq. Escalating tensions in the Middle East could disrupt oil supplies out of the region.

Analysts think some traders and investors will try to push oil prices to the psychologically important $100 level this week. Crude prices are within the range of inflation-adjusted highs set in early 1980. Depending on the how the adjustment is calculated, $38 a barrel then would be worth $96 to $103 or more today.

“I wouldn’t see this sell-off today as the start of a correction,” Kurzendoerfer said.