|US refinery production and supplies of gasoline have fallen recently while US demand for gasoline has risen, all leading to higher gas prices. (Reed Saxon/Associated Press)|
Energy Dept. chief says gas prices may hit record
NEW YORK -- The average price of gasoline in the United States might touch a record this summer because of refinery disruptions and the high cost of crude oil, Energy Secretary Samuel Bodman said.
While the government's official forecast has prices peaking below $3 a gallon this year, energy market predictions are not precise enough to rule out higher costs, Bodman said in New York. The loss of output from plants such as Valero Energy Corp.'s McKee refinery in Sunray, Texas, which was shut by a fire in February, has made supplies tight, he said.
"We have had a number of refinery outages; we have had a run-up in oil prices," Bodman said. "The combination of those has led to concerns on my part. Not so much that we'll have shortages. I do not think so. But I worry about price."
The Energy Department's statistics and forecasting arm, the Energy Information Administration, predicted in a report this month that the nationwide average pump price for gasoline will peak in May at $2.87 a gallon. That's below last year's high of $2.98 in July, and it is about 20 cents shy of the record high of $3.067 in early September 2005, after Hurricane Katrina.
Asked if the record could fall this summer, Bodman said, "It could happen."
The percentage of US refinery capacity in operation during the first quarter dipped to 87.3 percent, down from 88.9 percent a year earlier. Meanwhile, gasoline demand rose 1.7 percent year-over-year, more than twice the 0.8 percent growth rate of the first quarter of 2006.