Regular-grade gasoline is expected to average $3.78/gal. in 2008, or 97¢ above the 2007 average price, reports the Energy Information Administration (EIA) in its “Short-Term Energy Outlook.” The U.S. average regular gasoline price, currently over $4/gal., is projected to peak at $4.15 in August. Meanwhile, retail diesel-fuel prices are projected to average $4.32/gal. in both 2008 and 2009, an increase of $1.44 over the 2007 average.

In addition, world oil consumption is projected to grow by 1 million barrels per day (bbl/d) in 2008. U.S. consumption of liquid fuels and other petroleum is expected to decline by about 290,000 bbl/d in 2008 because of higher petroleum product prices and slower economic growth. Adjusting for increased ethanol use, U.S. petroleum consumption is projected to fall by 440,000 bbl/d in 2008.

Meanwhile, for the week ending June 9, the U.S. average retail price for regular gasoline increased to another record high for the 11th straight week and surpassed $4/gal. for the first time. The price rose 6.3¢ to $4.039, or 96.3¢ higher than last year at this time. The national average price of diesel dropped 1.5¢ for the second week in a row to settle at $4.692/gal., $1.90 more than a year ago.

For gasoline, the West Coast recorded the highest average price, soaring 15.9¢ to $4.325/gal., while California was up 19.1¢ to $4.433. The Gulf Coast remained the lowest at $3.909, despite a 6.3¢ jump for the week.

For diesel, the week’s lowest regional price occurred in the Midwest, at $4.615, while the West Coast was the highest at $4.874. At $4.992/gal., California slipped below $5 price for the first time since May 19.