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LONDON -- The price of oil is likely to remain high in coming months and could rise further, due to ravenous global demand and petroleum producers' reluctance to boost supplies, reported the Associated Press.
The average price of regular unleaded gasoline in the United States is $1.84 per gallon, according to the U.S. Department of Energy, and analysts say the cost could rise to as high as $3 per gallon in some regional markets.
On Tuesday, markets rose after the U.S. ambassador to Saudi Arabia, the world's largest oil exporter, advised Americans to leave the country following the killings of five foreign workers at a petrochemical plant there.
OPEC, which pumps one-third of the world's oil, has reaped a windfall from higher crude prices. OPEC insists that it aims for an average target price of $25 per barrel for its benchmark blend of crudes, but the actual benchmark stood 37 percent higher than this at $34.13 on Monday, the most recent day for which OPEC compiled data.
The confluence of Middle East jitters, soaring demand and tight U.S. inventories has some analysts predicting that oil could soon cross the $40-per-barrel level. Energy analyst John Kilduff of Fimat USA said his firm expects crude to peak between $41 and $43-per-barrel soon, but then fall back as soon as oil inventories build up.
Any sharp increase in supplies can cause prices to crash. But the summer driving season is looming, and analysts said upward pressure on oil prices will only grow in coming months, according to the AP.
Several retailers are battling the high gas prices by offering special deals. For instance, Susquehanna Valley, Pa.-based Tom's convenience stores began offering its customers 5 cents per gallon off if they pay cash for gas. Tom's is offering the discount as a way of reducing the cost of processing credit- and debit-card transactions.