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CHICAGO -- Unrest in the Middle East and a prolonged strike in Venezuela are pushing fuel prices and squeezing margins nationwide. But some recent overnight spikes in the Midwest are shocking motorists and even veteran market watchers. They include post-Christmas increases of 20 cents a gallon in Lexington, Ky., and 16 cents a gallon in Findlay, Ohio.
Normally prices rise a couple of pennies at a time but, after keeping prices steady throughout much of December, retailers may now be rushing to pass along record-high wholesale prices to consumers, analysts said.
"Basically, retail prices have to adjust to what's going on with wholesale markets," Jacob Bournazian, an analyst who tracks gasoline trends for the Energy Department, told Reuters.
U.S. fuel supplies remain adequate but have gotten tighter, Bournazian said, due to the loss of oil and gasoline shipments from Venezuela, whose petroleum industry has been shut down due to political strife since the beginning of December.
The price of crude for February delivery rose 23 cents to $32.72 per barrel -- a two-year high. The wholesale price of gasoline rose 0.28 cent to 93.25 cents a gallon, levels not seen since June 2001. The nationwide retail price of gasoline was $1.40 per gallon, up roughly 4 cents from the week before and 33 cents from the previous year, according to the Energy Information Administration, the Energy Department's statistical arm.
In Lexington, Ky., BP, Shell and Speedway stations across the city raised their per-gallon prices for regular unleaded gas from about $1.29 to $1.49 the day after Christmas.
Lexington's gasoline market is dominated by Speedway and SuperAmerica, the convenience store brand operated by Marathon Ashland Petroleum LLC of Findlay. Linda Casey, a spokeswoman for Speedway, confirmed to Reuters that a systemwide gasoline price increase had gone into effect as a result of higher oil prices.
Marathon Ashland has seven refineries and 2,250 gas stations in 11 states throughout the Midwest. Casey said the magnitude of the increase varied from market to market, and was up 15 to 16 cents per gallon in Findlay. Some other stations said they took their cue from Speedway. "We go by what the price is in the rest of the area and we concentrate on (competing with) Speedway," said Carla Hensley, manager of Lexington Shell convenience store. "If they go up, we go up. If they go down, we go down."
Casey said Speedway's prices typically follow those of its major competitors in the Midwest, particularly The Kroger Co., a Cincinnati-based supermarket chain that also sells gasoline. A spokesman for Kroger could not be reached for comment.