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US gasoline demand keeps rising

US gasoline demand keeps rising

March 23rd, 2011 in News

NEW YORK (AP) - Oil prices rose Wednesday after the government said U.S. gasoline demand continues to rise despite sharp price increase at the pump.

The Energy Information Administration report suggests that American motorists are so far handling higher fuel costs without cutting back. At a national average of $3.548 per gallon, retail gasoline prices remain at the highest ever for this time of year and have reached a point where economists expect consumers to start to cut spending.

The EIA said the U.S. consumed an average of 9.1 million barrels per day of gasoline, up 1.2 percent from the same period last year. Gasoline supplies also dropped last week by 5.3 million barrels, more than twice as much as expected.

Benchmark West Texas Intermediate crude for May delivery added 59 cents at $105.56 per barrel on the New York Mercantile Exchange in midday trading.

Oil prices have jumped about 24 percent since the middle of February when fighting broke out in Libya and threatened the country's oil fields. The clash between Moammar Gadhafi and pro-democracy rebels has shut down most of the country's oil production and experts say Libya's exports will remain off-line for months.