WASHINGTON -- The retail price of gasoline hit an all-time high Tuesday -- nearly $1.74 per gallon nationwide -- reflecting strong demand, tight supplies and the high cost of oil, AAA reported.
AAA, formerly the American Automobile Association, reported that motorists are now paying $1.738 per gallon for self-serve regular unleaded gasoline, one-tenth of a penny higher than the previous record set Aug. 30 of last year. Premium unleaded costs more than $2 a gallon in many parts of the country.
"Unstable gasoline prices make budgeting for fuel costs extremely difficult for families and businesses," AAA said in a statement.
The Orlando, Fla.-based travel agency gets its data from Oil Price Information Service of Lakewood, N.J., which collects retail price information from 60,000 locations daily.
Gasoline prices traditionally rise between March and May as refiners temporarily shut down their plants in preparation for the peak summer driving season, when special clean-burning blends of fuel are required. These shutdowns shrink supplies.
This year, the effect on price has been magnified because commercial inventories of gasoline are already low. For the week ended March 12, U.S. gasoline inventories stood at 199.6 million barrels, down from 202.1 million barrels a year ago.
The most recent statistics from the Energy Department show that gasoline demand has been roughly 4.5 percent higher than last year over the past four weeks, at 8.9 million barrels a day. Moreover, refiners are maintaining extremely lean inventories because of the high price of crude oil, another factor contributing to higher fuel prices.
Crude oil for May delivery sold for $37.45 per barrel Tuesday on the New York Mercantile Exchange, up 40 cents. The price of oil is below recent highs but still near its highest level in 14 years.
The Energy Department's weekly survey of retail gasoline prices, released Monday, showed a jump to $1.743 in the national average for regular grade gasoline in the week ended March 22, up from $1.724 the week before. That's still 0.4 cent below the record the agency reported last August.
The department's Energy Information Administration compiles the data weekly from a sampling of about 800 locations from a database of 115,000 stations monitored.
Meantime, some Democratic lawmakers criticized the Bush administration for contributing to the recent run-up in fuel costs by purchasing oil for the nation's Strategic Petroleum Reserve at a time when supplies are tight, driving prices even higher.
Sen. Carl Levin, D-Mich., questioned the diversion at a time when private oil inventories, at 281 million barrels, are 23.4 million barrels below the five-year average for this time of year, according to the EIA.
"When supply goes down in the private inventory the price is going to go up," argued Levin. He said high energy prices have been "a drag on the economy" and pose national security concerns.
Sens. Charles Schumer of New York, Barbara Boxer of California and Harry Reid of Nevada also urged the Bush administration release oil from the reserve, which is close to its 700 million-barrel capacity at 648 million barrels as of March 12.
Energy Secretary Spencer Abraham has repeatedly said the administration views the petroleum reserve as an emergency stockpile for national security and that it should not be used to manipulate prices.
The amount of oil being taken off the market "is fairly negligible" in a global oil market of 86 million barrels a day, Abraham said Tuesday at a Senate hearing.
Last week, another private survey, compiled weekly by California-based analyst Trilby Lundberg, put the average price of gasoline at $1.77 per gallon -- a penny above the survey's previous record in May 2001. Lundberg surveys 8,000 gas stations.
Associated Press writer H. Josef Hebert contributed to this story.
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