CAMARILLO, Calif. -- The average pump price for regular grade is $2.1790, up 7.87 cents from two weeks ago. It has climbed about 41 cents over nine weeks, according to the most recent Lundberg Survey of approximately 2,500 U.S. gas stations.
There may be a few more pennies to come. There are two clear causes of the rise since winter ended: Crude oil prices have been edging up, and so have U.S. refiners' costs of making and distributing spring-summer blends. If crude oil prices do not beat a retreat quickly, gasoline prices may still inch up.
In much of the country, refiners are still racing the calendar to comply with regulations requiring lower-vapor-pressure product May 1 at the wholesale level in advance of the June 1 deadline at the consumer level.
The rack price roller-coaster ride means a similar choppy ride for retail margin. Most recently, increases at the racks have hit in most locales, and some retailers have yet to pass them through. The result: Since April 8, the U.S. average retail margin on regular-grade gasoline lost close to 7 cents. Margin on April 22 is just 11.26 cents, the skinniest since July 10 of last year.
The pain of skimpy margins is made more acute by various retail business costs, to be paid out of margin, which are rising in many markets. Retail margin recovery will likely occur sometime soon.
Refiner margin, meanwhile, has been improving after a long stretch of paucity, as gasoline's seasonally changing specs take a bigger chunk.
Industry critics and regulators are often unaware of the consumer price consequences of mandating gasoline formula changes, even the spring-summer ones that have hit the market ever since March 1989.
Camarillo, Calif.-based Lundberg Survey Inc. is an independent market research company specializing in the U.S. petroleum marketing and related industries.
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