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Gas prices still climbing
Gas prices zoom more than 14 cents, continuing upward trek; average at $2.07
May 23, 2004: 4:18 PM EDT

NEW YORK (CNN) - Gas prices continued their upward trek over the past two weeks, climbing more than 14 cents to a U.S. average of $2.07 per gallon, a nationwide survey said Sunday.

San Diego drivers paid the most, at $2.36 per gallon of self-serve regular, and Charleston, S.C. drivers paid the least, at $1.87 per gallon, said Trilby Lundberg, whose Lundberg Survey tallied prices May 7 and 21.

The price of crude oil "is still a driver of the high prices," with prices exceeding $41 on some of the days, though they closed below $40 on Friday, she said.

Three other factors added to the cost, she said: seasonal demand is rising as Americans begin to drive more during the warmer months; the improvement in the nation's economic health has increased demand for oil; and refiners are gearing up to meet a June 1 deadline to reformulate gasoline to reduce smog in the summer, a process that has forced some refineries off-line.

Lundberg predicted that those members of the Organization of Petroleum Exporting Countries that can pump more will begin doing so soon, even if they do not announce an agreement to do so publicly in their planned June 3 official meeting in Beirut.

Saudi Arabia announced Sunday at an unofficial OPEC meeting in Amsterdam that it would boost its production next month by 28 percent.

"Those that can will do so, either officially -- as Saudi Arabia has -- or unofficially, simply because of the temptation of higher prices," Lundberg said.

Still, she predicted, the increased production may not offset the factors that continue to pull up the price of gasoline.

"I don't think it has peaked and I don't think an increase in oil production immediately can offset the immediate up pressures that exist specific to the U.S. gasoline market," she said.

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Though the prices are the highest ever -- the sixth consecutive survey to report that -- they are not the highest if the prices are adjusted for inflation. And OPEC oil ministers have not been worried that the increased prices will shrink demand, Lundberg said.

"World demand has been growing, despite the prices, mostly due to the United States' and China's oil demand leading the demand increase," she said.

Here are prices of gasoline in other American cities:

-- Houston: $1.90

-- Albuquerque, N.M.: $1.94

-- Denver: $1.98

-- Washington: $2.08

-- Detroit: $2.09

-- Long Island: $2.21

-- Seattle: $2.31  Top of page




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