The Energy Information Administration (EIA) reports that the U.S. average price for regular gasoline increased three cents to $2.83 per gallon last week, 79 cents above last year. Growing by less than half a cent, prices on the West Coast (Alaska, Arizona, California, Hawaii, Nevada, Oregon, and Washington) and in California were essentially unchanged at $3.04 per gallon and $3.09 per gallon, respectively.
     The U.S. average price for diesel fuel shot up nearly eight cents, surpassing three dollars per gallon for the first time since early November 2008. At $3.02 per gallon, the price was 79 cents above last year at this time. The West Coast price jumped about nine cents to $3.11 per gallon, while the average in California moved up more than seven cents to $3.15 per gallon.
     EIA notes that refinery production of gasoline is under considerable pressure due to the increased ethanol blending with unleaded to accommodate the Renewable Fuel Standards increases. The amount of ethanol blended into gasoline increased during the summer of 2008 and ethanol is projected to average about 8.9 percent of total gasoline consumption by this summer. The Renewable Fuel Standard requires an increase in renewable fuels from a total of 10.6 billion gallons in 2009 to 12.3 billion gallons in 2010. The growth in ethanol consumption is being met primarily by domestic production.
     The Oil Pricing Information Service asserts that the price of crude oil has been dictated by the dollar and equities. Movements in these areas Friday would indicate that oil should go higher, since the dollar was weaker and equities slightly higher. A downgrade for Greek debt was seen as one of the reasons for the losses in oil last week although, some could be tied to profit-taking. Over the last three sessions, crude oil has lost close to $2 with Friday's loss of 47cts, putting settlement prices at $84.92 per barrel.

Chris Nobles
Commercial Fueling
Nella Oil Company