Gas prices hit 5th straight record
The price for a gallon of gas sets a new record high at $3.718, according to AAA; crude prices tumble as the dollar strengthens.
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| Consumers keep getting pinched at the pump with retail gas averaging $3.718 a gallon, according to AAA. |
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| Crude prices have more than doubled in the last year. |
NEW YORK (CNNMoney.com) -- Retail gasoline prices increased for the sixth straight day and hit their fifth consecutive record, auto group AAA's Web site showed Monday.
The national average price for a gallon of regular unleaded gasoline rose to a new all-time high of $3.718, up 1 and one-tenth of a cent from the previous day.
Crude prices, meanwhile, tumbled on the stronger dollar.
Drivers now pay 21% more for a gallon of gas than they did a year ago, when a gallon of gas cost on average $3.064, according to AAA.
Consumers have been pinched at the pump as the price of a barrel of crude oil has doubled in the past year. Crude prices settled at a record close of $125.96 a barrel Friday after breaking $126 a barrel earlier in the session.
Stronger dollar: Crude futures pulled back from those record levels as the dollar gained Monday.
Light, sweet crude for June delivery jumped to a new all-time high of $126.40 a barrel in light trading on the New York Mercantile Exchange before falling back to settle at $124.23, down $1.73 from Friday's closing record of $125.96. It was the first time oil has closed lower in six sessions.
When the dollar is weak, investors often look to commodities like oil as a hedge against inflation. But a stronger U.S. currency can reverse that trend.
The euro was quoted at $1.5405 early Monday, down from $ 1.5480 late Friday in New York. The dollar also strengthened against the yen, rising back above the ¥103 mark.
Many analysts believe the weak dollar has driven oil prices to levels that defy fundamental supply and demand economics. But other investors see continued strong demand for oil and fuel from China and India as a sign that oil prices have further room to rise.
Growing concerns about declining crude production in Mexico, Russia and elsewhere are keeping prices in record territory, analysts say. Goldman Sachs said in a report last week that crude prices could rise to $150 to $200 within two years.
"What's really circulating now is the possibility that world oil production has peaked. There's an idea that we can't change supply but we can change demand, and the only way to do that is to rally the market higher," said James Cordier, founder of OptionSellers.com, a Tampa, Fla., trading firm.
China: Some analysts expect that China's trade data for April will move the price of oil.
China's inflation rose in April to the highest level in a decade, according to a government report released on Monday.
The government also released data on Monday showing China's trade surplus fell by 1% in April. Less money flooding into the economy could ease inflation in China.
According to preliminary data from China's General Administration of Customs, the country's crude oil imports for April totaled 104 million barrels, lower than the 126.3 million barrels imported in March.
Also pressuring oil prices Monday were concerns that a massive earthquake Monday in western China may temporarily slow demand. The 7.8-magnitude quake, which was felt as far away as Vietnam, Pakistan and Thailand, killed more than 7,600 people, toppled buildings and knocked out power lines.
"We know that some power and electricity plants are off-line, so that could have a negative impact on demand," said Phil Flynn, analyst at Alaron Trading Corp. in Chicago. "But obviously the market is still showing strength so it has a lot of bounce in it."
Venezuela: The advance of oil prices at the end of last week was spurred by evidence that Venezuelan President Hugo Chavez has offered assistance to Colombian rebels. Recovered documents from a slain guerrilla fighter show that Chavez has offered assistance to Columbian fighting rebels.
Some U.S. lawmakers think that the White House should add Venezuela to a list of state terror sponsors, including North Korea, Iran, Syria, Sudan and Cuba. If the U.S. were to add Venezuela to that list, however, the country could cut off oil experts to the U.S.
Venezuela is a key supplier of oil to the U.S. and decreasing supplies of oil to the U.S. would push up the price of oil.
More energy prices: In other Nymex trading Monday, June gasoline futures fell 3.7 cents to settle at $3.1642 a gallon after earlier rising to a trading record of $3.218 a gallon. June natural gas futures fell 2.36 cents to settle at $11.301 per 1,000 cubic feet after earlier rising to its own trading record of $11.675.
In London, June Brent crude futures fell $2.03 to $123.93 a barrel on the ICE Futures Exchange.
A drop in heating oil prices also led crude lower Monday, analysts said. Heating oil for June delivery fell 7.62 cents to settle at $3.5598 a gallon on the Nymex.
"Any weakness in heating oil is going to be bearish for crude on a fundamental level and also psychologically," said Andrew Lebow, senior vice president at Man Financial Inc. in New York.
-- from staff and wire reports 
