NEW YORK - Oil prices blew past $130 a barrel yesterday for the first time and kept going, while gasoline prices persisted in their own relentless climb, rising above $3.80 a gallon.
Supply worries, rising demand, and a slumping dollar are combining to make filling up the car - and paying for just about everything else - a growing burden for Americans.
In the five-county Philadelphia area in Southeastern Pennsylvania, the average pump price yesterday rose one cent to $3.85 a gallon, AAA Mid-Atlantic said. In Philadelphia's three suburban counties in South Jersey, yesterday's average was unchanged at $3.67, AAA said.
There are technical signals in the oil-futures market, including price differences between near-term and longer-term contracts, that crude prices may soon fall. But with demand for oil growing in the developing world, and little end in sight to supply problems in producing countries such as Nigeria, few analysts are willing to call an end to crude's rally.
Oil's gain yesterday was fed in part by a report from the U.S. Energy Department's Energy Information Administration, which said crude inventories fell more than five million barrels last week. Analysts had expected a modest increase.
Light, sweet crude for July delivery rose $4.19 to settle at $133.17 a barrel on the New York Mercantile Exchange. It was crude's largest one-day price advance since March 26.
The dollar, meanwhile, weakened against the euro yesterday. Investors see hard commodities such as oil as a hedge against inflation and a weak dollar and pour into the crude futures market when the greenback falls. A weak dollar also makes oil less expensive to buyers dealing in other currencies.