Drivers are paying more to fill their gas tanks and experts say prices could continue to inch up.
Nationwide, the average price for one gallon of regular gasoline on Sunday was $2.80. That is 32.6 cents higher than at the same time a year earlier and per-gallon average seen sine May, according to the AAA auto club.
Gas prices are largely driven by the weak dollar and refining capacity, meaning the recent increase may be due more to investor behavior than changes in the market, such as the 4.2 percent annual increase in crude oil prices.
The value of the dollar has been falling in anticipation of the Federal Reserve putting more money into the economy. Since crude oil is priced it dollars, a barrel of oil becomes cheaper for buyers using healthier currencies. The higher oil prices mean higher gasoline prices.
At the end of last week, crude oil closed at $82.66, an 11 percent increase from the middle of September. Heating oil futures were up 7 percent during the same period.
Refining capacity is low at the moment while many U.S gasoline refineries undergo routine maintenance. At the end of September, U.S refineries were working at 83.1 percent capacity, the lowest rate since March, according to oil industry analyst Tom Kloza.
High gas prices at this time of year are not the norm, said analyst Darin Newsom of Telvent DTN. “This year is just one of those anomalies,” he said.
Newsom expected wholesale gas prices and heating oil futures to rise more this week before leveling off. Kloza agreed that oil is probably near its high for the year.