Gas pump prices have climbed for 35 straight days even though industry surveys show Americans have started to drive less.
The national average rose by a penny to hit $3.87 per gallon on Tuesday, more than a dollar higher than it was last year. Experts say prices should keep rising for the next few weeks before weaker consumer demand forces prices to drop. "We're going to see prices keep bumping up for three, maybe four weeks," energy analyst Jim Ritterbusch said. Eventually less travel will take its toll, Ritterbusch said.
"They're going to cut back on spending, and that will push gas prices down," he said. "All that should kick in by June."
Retail gasoline prices have become a growing burden for consumers this year. They've risen 32.2 cents per gallon since March 22 and are averaging above $4 per gallon in California, New York, Michigan, Illinois, Connecticut, Washington D.C., Alaska and Hawaii.
Gasoline futures got another boost on Tuesday after three Texas refineries lost power. Authorities are still looking for the cause of the outage at the Valero, BP and Marathon Oil refineries in Texas City. A Dow Chemical plant also lost power.
Gasoline futures rose 2.87 cents to settle at $3.3072 per gallon on the New York Mercantile Exchange. Earlier in the day, the contract hit $3.3226 per gallon, the highest price since July 2008.
Oil analyst Tom Kloza said the refinery shutdowns may have halted 300,000 barrels of daily gasoline production. It'll take time to get those refineries back online Kloza said. "Refineries are finicky. It's not like turning the lights back on."
Kloza thinks gas will fall as more consumers drive less and demand falls. But the news will probably get worse before it gets better. He expects pump prices will soon hit a national average of $4 per gallon.
MasterCard SpendingPulse said again Tuesday that motorists have cut back on gasoline purchases. SpendingPulse estimated that the four-week consumption average has dropped for five straight weeks, when compared with the same period a year ago. Americans bought about 386 million gallons per day last week, down 2 percent from last year, SpendingPulse said in its weekly survey.
Meanwhile, benchmark crude for June delivery was little changed. It lost 7 cents to settle at $112.21 per barrel on the Nymex.
Investors are waiting to hear what the Federal Reserve will have to say about the nation's economy and interest rates. The Fed meets Tuesday and Wednesday. The expectation is that the central bank will keep interest rates where they are now, near zero.
In other Nymex trading for May contracts, heating oil gained 2.84 cents to settle at $3.2273 per gallon and natural gas was nearly unchanged, settling at $4.387 per 1,000 cubic feet.
In London, Brent crude rose 48 cents to settle at $124.14 per barrel on the ICE Futures exchange.