NEW YORK – The price of gasoline fell slightly over the Memorial Day weekend, stalling a rise in U.S. pump prices to record highs and offering relief to millions of motorists, the AAA auto club (search) said Tuesday.
The average price for a gallon of self-serve regular fell 1 cent to $2.04 over the long weekend, halting a spike of more than 20 cents since early May, according to the auto group's daily survey of more than 60,000 filling stations.
The slight decline came as domestic refiners boosted their fuel production rates to meet voracious demand and as crude oil prices briefly retreated below $40 a barrel, AAA spokesman Geoff Sundstrom said.
"If we can read anything into this slip in prices, it is that the entire oil industry is now fully converted to summer fuel blends, allowing them to produce more of what the market needs," said Sundstrom.
"We also had some positive statements from Saudi Arabia, which helped reduce the price of crude," he said.
Saudi Arabia, the most influential member of the OPEC (search) oil cartel, proposed last week a big increase in the group's crude output limits, helping U.S. crude oil futures slip briefly below $40 a barrel.
Prices have since rebounded to a record of $42 a barrel on worries over attacks in Saudi Arabia at an oil workers' compound that killed 22 people.
OPEC was expected to make a formal decision on output at its meeting June 3. A source told Reuters Tuesday the group would likely add 1 million barrels per day of additional oil to the world market.
Retail U.S. gasoline prices have been zipping along near all-time highs over $2.05 a gallon in nominal terms but remain well-below the inflation-adjusted peak of nearly $3 a gallon hit in 1981.