Current Gasoline Price Posts a Sharp Rise

The increases in the current gasoline prices are not as sharp as what was witnessed in October of 2012. However, the latest rise of 25 cents per gallon is gaining the attention of many.

In Los Angeles, the average gasoline price today is $4.017 per gallon, according to AAA.

That rate is higher compared to last week’s average of $3.679 per gallon. The numbers may possibly continue to increase for at least another two weeks, although it won’t reach the record high of $4.69 per gallon posted last October 9.

The explanation for these increases include higher per barrel oil prices, refineries going through routine maintenance in preparation for the shift to the cleaner-burning blend of summer gas, and investors bidding prices higher. Usually, prices reach a peak prior to Memorial Day, although in the past years, the price movements have not been very predictable.

The American Automobile Association said in a press release that the usual causes are the ones listed for the increases in gas prices. These include the high prices of oil, tensions in the Middle East, incidents at local refineries and the shutting down of other refineries for regular maintenance as they get ready for summer blend production, said Jeffrey Spring, a spokesman of the auto club.

Analysts of the oil industry also stated that managers of financial assets see refined gasoline as a safe bet for the portfolios of their clients.

Huge investments are moving earlier and earlier into the trading of gasoline, prior to the typical spring spike. In particular, Southern California is a susceptible market for supply shortages due to the lack of cheaper alternatives in case production at local refineries is down, and traders know this.

By: Chris Termeer