Gasoline prices rising along with temperature

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If there is any benefit to the bitterly cold and seemingly endless winter, it's that gasoline prices have remained relatively frozen. But an unwelcome spring thaw in prices has started.

The national average for a gallon of gasoline increased more than 5 cents in the past week to $3.36 per gallon. In Pittsburgh, drivers are paying an average of $3.59 per gallon, an increase of more than 4 cents from the previous week.

Analysts expect prices to continue to rise.

The blame is split between the warmer temperatures that usually bring higher gasoline prices and a spike in crude oil prices that has started driving up the cost.

Supply concerns pushed the price of crude oil last week higher than $100 per barrel for the first time in 2014. Although the oil price slipped briefly this week, based on sluggish demand caused by the cold and snowy weather that kept motorists in their homes and off the roads, crude oil futures climbed to $103.31 per barrel Wednesday on the New York Mercantile Exchange.

"By and large, the recent rally is certainly about oil prices rising," said Patrick DeHaan, senior petroleum analyst for GasBuddy.com, a Minnesota website that tracks prices at more than 140,000 gas stations in North America.

Crude oil prices fell to $91.80 per barrel on Jan. 13, nearly a four-year low. Since then, they have increased about 15 percent.


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Drivers may be pleased to know that prices at the pump have not kept pace.

"Retail margins tend to go down when gas prices go up," said Jeff Lenard, vice president of strategic industry initiatives at the National Association of Convenience Stores in Alexandria, Va. "That's because of competitive pressures -- nobody wants to blink first."

That's because consumers are willing to drive for a better price on gas -- taking their spending on coffee, subs and gallons of milk with them.

On the other hand, when oil prices fall, retailers tend to wait before dropping prices to make up for the profits that were lost when they didn't rush to pass along price increases, he said.

Gasoline prices typically rise in late February anyway, when production slows as refineries begin preparations for summer fuel blends. This has been a trend since 1995, when the first version of the Environmental Protection Agency's Clean Air Act put restrictions on the type of gas sold during the summer months to reduce pollution.

"At its core, this is about environmental regulations," Mr. Lenard said. "That's all good. I don't think anybody's arguing against environmental regulation. But it just complicates the system."

While summer gas is more expensive to produce than the winter blend, what is most costly for consumers is the preparation for the changeover. Refineries shut down for maintenance in the spring, putting a strain on supplies.

"It's not just a light switch," Mr. DeHaan said. "It's a process."

And that process typically adds 50 cents to what consumers were paying for gas in the winter, he said.

"One bummer of approaching spring," Mr. Lenard said.

This year, the conversion will drive the national average to anywhere between $3.55 and $3.75 per gallon, AAA estimated in a report published this month. The association expects prices to peak around Memorial Day before tapering off once the changeover to the summer blend has been completed.

By now, consumers should be used to the pattern.

"We've seen these trends over the last few years," said Bevi Powell, senior vice president of AAA East Central, based in East Liberty.

If anything, U.S. gas consumers will have it better off this year. Winter prices remained relatively low because there were no supply disruptions and few geopolitical concerns.

In 2011, violence in Egypt and Libya forced gas prices up in the winter.

In 2012, escalating tensions with Iran had prices climbing early as well. There were no major disruptions last year, but prices then were much higher than they are now -- $3.71 nationally and $3.81 locally on average for a gallon of gas.

Gas prices this winter were as low as they have been since late 2011, which should put drivers in better position to handle the upcoming hikes, Ms. Powell said.

Consumers can check phone apps and gas-tracking websites to find the best local prices, she said. And drivers should time their trips to the gas station with other errands to save themselves from driving unneeded miles.


Michael Sanserino: msanserino@post-gazette.com, 412-263-1969 or on Twitter @msanserino.

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