Oil prices fall, but gas prices rise

February 20, 2009 3:46:24 PM PST
Though oil prices are plummeting, the price of gas is going up.The national average dropped a cent today to $1.94, but had gone up every day for the past three weeks.

"What the market trends to do in February, March and April is live off existing supplies," said Stephen Schork, and oil industry analyst. "Inherently, this provides upward pressure on prices."

Schorks says this is the time of year refineries scale back operations for maintenance, and then produce summer blends of gasoline.

Together with the economic uncertainty that could affect pricing and driving demand the refineries are producing less, about 82% of capacity.

This, Schorck says, is four to five percent below normal. He believes gas prices will peak in June.

"Get use to it. Gasoline prices are rising, they're going to continue to rise between now and well into May," Schorck said.

Experts say these gas prices will continue to rise as much at 50 to 75 cents a gallon by Memorial Day.

The good news is, they won't be anywhere near last year's national average of $4 a gallon.

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