Gasoline prices won’t peak until November: EIA

WASHINGTON – U.S. drivers can expect to shell out more than $4 a gallon, on average, for gasoline for the rest of 2008 and prices will keep rising until November, the U.S. Energy Information Administration said. Oil prices, meanwhile, will remain under pressure from the tight market for crude and international demand. Regular-grade gasoline in the United States is expected to average $3.84 a gallon in 2008, up from last month’s forecast of $3.78 a gallon, the agency said.

For the rest of 2008, pump prices are projected to remain well above $4.00 per gallon, peaking in November at $4.25 a gallon, the agency said in its Short Term Energy Outlook. Gasoline prices normally peak in the summer driving months.

“This forecast reflects very weak gasoline margins, because of the decline in gasoline consumption and growth in ethanol supply,” it said. Retail diesel fuel prices, which averaged $2.88 in 2007, are projected to average $4.35 per gallon in 2008 and $4.48 per gallon in 2009.

Oil prices, meanwhile, are expected to average $127 a barrel this year, up from the previous forecast of $122 a barrel, the agency said. In 2009 the oil prices are expected to average $133 a barrel.

“Global supply uncertainties, combined with significant demand growth in China, the Middle East, and Latin America, are expected to continue to pressure oil markets,” the agency said.