Oil prices march higher, gas tops $3.70

Friday, August 10, 2012, Vol. 36, No. 32
PABLO GORONDI, Associated Press

NEW YORK (AP) — The price of oil is holding on stubbornly to its recent gains, and that's causing pain at the pump for U.S. drivers.

Benchmark crude rose 70 cents to finish at $93.43 a barrel Tuesday in New York. It's up $5 a barrel so far this month. Retail gasoline, meanwhile, topped an average of $3.70 per gallon for the first time since May 19. The national average has climbed by more than 30 cents in the last month and is up about 10 cents from a year ago, according to AAA, Wright Express and the Oil Price Information Service. In all, 39 states are now seeing higher gas prices than at this time last year.

A surprisingly strong July showing from U.S. retailers is a sign that energy demand could be on its way up. The Commerce Department reported Tuesday that sales rose last month by the largest amount in five months as Americans spent more on cars, furniture and clothes. The gain, which was better than analysts expected, suggested that the economy was strengthening.

Traders are also looking ahead to Wednesday's oil inventory report from the Department of Energy, which many expect will show that crude stockpiles fell for a third straight week. Still, crude supplies are about 11 percent above year-ago levels, according to Addison Armstrong, director of market research at Tradition Energy.

Brent crude, which is used to price international varieties of oil, rose 43 cents to end at $114.03 a barrel on the ICE Futures exchange in London. It has gained more than $8 per barrel this month.

Here's how other commodities futures finished on the New York Mercantile Exchange:

— Wholesale gasoline rose 1.07 cents to $3.0014 a gallon.

— Heating oil rose 1.63 cents to $3.0346 a gallon.

— Natural gas gained 10.5 cents to $2.8340 per 1,000 cubic feet.