Pump prices kept marching toward $4 a gallon Thursday and signs of a stronger U.S. economy helped push the price of benchmark oil past $108 per barrel.
Retail gasoline prices haven't fallen in 35 days, rising Thursday to a national average of $3.74 per gallon. Over the five weeks prices have increased 37 cents per gallon or 11 percent. Prices are being driven by the price of oil. They have never been so high at this time of the year.
Wholesale gasoline futures rose 2 percent to finish at $3.35 per gallon, suggesting that retail prices will keep rising in the coming days. Typically gasoline prices rise in spring as demand rises and refiners begin to make expensive summer blends of gasoline required to meet clean air laws.
The price of West Texas Intermediate, the U.S. oil used as a benchmark, rose $1.77 to end at $108.84 a barrel in New York. Brent crude, which is imported by many U.S. refiners to make gasoline, rose $3.54 to finish at $126.20 a barrel in London.
Oil prices have risen 9 percent this year because global demand is high and supplies have been disrupted in South Sudan, Syria and elsewhere. There also is concern that tensions with Iran over its nuclear program could lead to further supply problems.
The U.S. economy is growing even though high oil prices are taking spending money from consumers and make shipping and travel more expensive.
Economic data released Thursday showed applications for unemployment benefits hit a four-year low, spending on residential construction rose and major retailers reported stronger-than-expected sales for February.
Stock prices rose on Wall Street Thursday, helped by the encouraging economic news. That bolstered the feeling that the economy could start burning more oil.
"It's almost impossible for oil to stay down with equities rising," said Rich Ilczyszyn, an analyst at ITrader.
Economists worry that high oil prices will eventually take a toll on the economy, though.
"We've weathered it OK so far, but it could become a much stronger headwind than we anticipate," said Diane Swonk, chief economist at Mesirow Financial.
Consumers have been helped by low heating and electricity bills this winter, which have eased the pain of high fill-up costs. The weather has been unusually mild across much of the country and natural gas, which is used to heat many homes and to generate electricity, has been cheap.
Natural gas futures fell nearly 6 percent Thursday to end at $2.46 per thousand cubic feet after the government reported that supplies of natural gas declined less than anticipated last week. The nation's supplies in storage are 45 percent above the five-year average and prices are close to a 10-year low.
In other energy trading, heating oil rose 7 cents to finish at $3.28 a gallon.
Jonathan Fahey can be reached at http://twitter.com/JonathanFahey.