Gas prices rise less than one cent over two weeks

Read source. Posted on Sun, Mar. 23, 2003
Associated Press

CAMARILLO, Calif. - After weeks of big increases, gas prices rose less than a penny nationwide over the past two weeks as oil markets calmed with the beginning of U.S. military action against Iraq, an industry analyst said Sunday.

The average price for gas nationwide, including all grades and taxes, was about $1.76 a gallon on Friday, according to the Lundberg survey of 8,000 stations.

That was an increase of just 0.71 cents from March 7, the date of the last Lundberg survey.

"Right now it appears possible that this year may already have seen its peak pump price," said analyst Trilby Lundberg.

War fears and uncertainty over the outcome of the Iraq crisis combined with a strike in Venezuela to send gas prices up more than 25 cents a gallon so far this year.

The price is leveling off now due to factors including the perception that the war will not substantially impact Iraqi oil production, Venezuela's comeback after the strike, and production increases by Saudi Arabia, Kuwait and others, Lundberg said.

"There was a lot of jargon such as war premium - it was more like an uncertainty premium," Lundberg said.

"The perception changed in favor of supply security enough so that oil futures prices have tumbled down," she said.

The price of a barrel of oil dropped $8 last week, from $34.93 at the close of the day March 17 - the day President Bush gave Saddam Hussein 48 hours to leave Iraq - to $26.90 at the end of the day Friday.

Lower prices could lie ahead, Lundberg said, "assuming of course there is no refining problem with getting our spring and summer formulas into place."

Still, one year ago motorists were paying 38 cents less per gallon - a weighted average of $1.38.

The national weighted average price of gasoline, including taxes, at self-serve pumps Friday was about $1.73 per gallon for regular, $1.82 for mid-grade and $1.91 for premium.