Gasoline prices averaged $3.14 a gallon in the U.S. last week, according to the U.S. Energy Information Administration, up 2.9% from Dec. 27. In February 2008, when oil prices settled in triple digits for the first time in history, retail gasoline prices in the U.S. were at $3.13 a gallon.
While U.S. prices haven’t scaled such heights—the benchmark oil contract on the New York Mercantile Exchange briefly surged Tuesday past $94—many U.S. oil refiners and consumers are finding their costs have already escalated. Refiners such as Valero Energy Corp. are paying prices that mostly track Brent, not the U.S. benchmark often referred to as West Texas Intermediate, and those costs are being passed on to gas stations.
The split between U.S. WTI prices and prices throughout the energy chain is unusual because typically WTI and Brent are within about $1 of each other. But in recent weeks the two have veered wildly, taking that gap to more than $19 last week—the widest on record.
Brent on Monday settled at $105.74, a two-year high, driven by increasing unrest in the Middle East. It surged to as high as $108.70 a barrel after the close on worries that the turmoil in Libya was curtailing output of that country’s sought-after oil. In the U.S. prices have been kept relatively in check by a glut of oil in the country’s main storage facility in Cushing, Okla. While the price of Brent has risen 12% this year, the WTI benchmark was down 5.7% through Friday. Nymex was closed Monday for Presidents Day.