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Retail gas prices rise in spite of supply glut and reduced Middle East tensions

February 11, 2011 |  1:18 pm

Retail gasoline prices have continued to rise in California and around the rest of the U.S., in spite of falling oil prices, mounting optimism about Middle East unrest, and U.S. fuel supplies so plentiful that their like has not been seen in 17 years.

The average price of a gallon of regular gasoline in California rose another 0.9 cents overnight to $3.426, according the AAA Fuel Gauge Report, which tracks prices daily using credit card receipts from more than 100,000 locations around the U.S., compiled by the Oil Price Information Service and Wright Express.AAA gas

The new California average was 3.7 cents a gallon higher than a week ago, 7.5 cents a gallon than it was last month, and 47.1 cents higher than it was in 2010.

Nationally, the average climbed to $3.127 a gallon from 3.119 a gallon on Thursday, which had been a slight drop from the $3.124 a gallon last week.

Both the California and national pump prices averages were as high as any recorded for this time of year. That was in spite of the fact that crude oil futures on the New York Mercantile Exchange fell to a 10-week low after Egyptian President Hosni Mubarak stepped down and handed power to the military. That helped reducing tensions in a country that controls the Suez Canal, a key strategic chokepoint for the transport of oil from the Middle East to Europe.

Crude futures for March delivery fell $1.15 to settle at $85.58 a barrel, the lowest NYMEX close in 10 weeks and the biggest weekly loss -- 3.9% -- since the week of Nov. 19. Brent North Sea crude, which has reacted with far more volatility to the Middle East unrest in Tunisia, Egypt and Yemen, was still far higher and ended the day up 18 cents to $101.05 a barrel on the London-based ICE Futures Europe exchange.

None of that would make U.S. motorists any happier about the prices they saw while filling up, especially after hearing that gasoline supplies were near historic highs. On Jan. 28, the Energy Department reported that gasoline supplies in the U.S. were at 236.2 million barrels, up 6.2 million barrels since the previous week, 8.1 million barrels higher than a year ago. By Feb. 4, they had risen again to 240.9 million, higher than at any time since 1993.

The record for a glut in U.S. gasoline supplies was recorded on March 2, 1990, at 251.1 million barrels, according to the Energy Department, at a time when gasoline was selling for $1.058 a gallon nationally.

-- Ronald D. White