Friday, May 11, 2012
Shrinking supplies of gasoline in California are pushing up wholesale prices and the effect is being felt at the pump.
SAN DIEGO The cost of fuel on the wholesale market jumped more than 30 cents a gallon this week. That's putting upward pressure on prices. The average cost of a gallon of gas rose about 4.5 cents overnight.
High prices have kept demand for fuel low, but now record inventories appear to be dwindling. The supply of fuel is shrinking, in part, because of refinery issues.
"There's been a lot of shutdowns for planned and unplanned maintenance, and also the refineries have been cutting back supply because demand has been very weak," said Charles Langley, a gasoline analyst for the Utility Consumer's Action Network.
The oil companies understand supply and demand, according to Langley. They supply less fuel, Langley said, and demand more money for it. Pump prices could jump as much as 15 cents a gallon over the weekend, pushing prices near record territory.