Retail petrol in the United States fell to the lowest level in a year as refineries restored production and stockpiles rose to an eight-month high.
Regular gasoline dropped 9.5 cents on Monday, or 2.8 per cent from a week earlier, to $3.254 a gallon, the lowest since December last year, according to data posted on the US energy department's website. Crude prices, by comparison, were up 2.2 per cent from a week ago in New York.
"Retail gasoline has been falling faster than crude prices have," David Hackett, the president of independent fuel consultant Stillwater Associates in Irvine, California, said. "The real story here is that gasoline inventories have built across the board."
Prices at the pump had risen as high as $3.878 in September, stoking debate over Barack Obama's policies in the months leading up to this year's US presidential election. Retail prices are down 16 per cent since then, with demand for petrol lagging behind pre-recession levels, US refineries coming back on line after disruptions, and domestic crude production rising.
The US is riding a technology known as hydraulic fracturing, or fracking, to produce an increasing proportion of its domestic needs. Fracking, which uses pressurised water to drive gas and oil from shale rock, has helped America to meet 83 per cent of its energy needs in the first eight months of this year, the highest annual level since 1991, energy department data shows.
Petrol supplies in the US increased 2.4 per cent in the week ended December 7 to 217.1 million barrels, the highest since April 6, the Energy Information Administration said.
They climbed a further 1.9 million barrels, or 0.9 per cent, to 219 millionlast week.
Consumption peaked at 9.68 million barrels a day during July 2007, according to the four-week average data from the energy department. Demand slipped to an 11-year low of 8.04 million during February.
The US is among the nations feeling the least pain at the pump, with a gallon of premium gasoline costing Americans 3 per cent of their daily income in October, 55th out of 60 nations.
* Bloomberg News
