Gas prices moving up as Thanksgiving nears

Retail pump prices are heading back toward their 2010 high as Americans map out their plans for Thanksgiving.

Gasoline demand isn't driving up prices, as it does when the summer driving season begins. Instead, investors are betting that oil prices will rise as the Federal Reserve's attempt to stimulate the U.S. economy by purchasing $600 billion in bonds gets into full swing.

In Philadelphia and the four surrounding counties in Pennsylvania, the average price Monday was $2.91 a gallon - up 2 cents over the weekend and 14 cents in the last month, AAA Mid-Atlantic said. In the three suburban counties in South Jersey, the average Monday was $2.73 a gallon, four cents higher than on Friday and 14 cents more than a month ago.

The national average for a gallon of unleaded regular gasoline was $2.854 Monday, according to AAA, Wright Express and Oil Price Information Service. That's up three cents from Friday and closing in on the high of $2.92 hit in early May.

Benchmark oil for December delivery settled up 21 cents on Monday to $87.06 a barrel on the New York Mercantile Exchange, the high for the year. The price of oil has risen more than 16 percent since Labor Day.

"For now, it's all about crude, and it's all about the perception that crude is one of the greatest [investment] places to park your money," said Tom Kloza, publisher and chief oil analyst at Oil Price Information Service.

Motorists in California, Washington, Oregon, New York and Illinois are among drivers paying the highest prices, in a range between $2.954 a gallon to $3.516 a gallon. The lowest prices range between $2.654 a gallon and $2.705 a gallon, and are found mostly in the Midwest, Texas and the South.

Kloza isn't sure if the nationwide average gas price will hit $3 a gallon before the end of the year, but he said it appears to be moving toward $2.90 a gallon in most areas.

The Federal Reserve plans to buy about $75 billion in bonds per month though the middle of next year. That might boost lending by banks, but the influx of dollars weakens the value of the U.S currency.

Oil is priced in dollars and becomes cheaper for holders of foreign currency when the dollar is weaker against other currencies. But it becomes more costly for holders of the dollar.