By Mark Williams, AP Energy Writer
Although gasoline prices are dropping ahead of the Memorial Day weekend and the start of the summer driving season, there's no sign motorists are rushing back to the pump to top off their tanks.
Data released Monday by the Federal Highway Administration show the number of miles driven on U.S. roads rose in March compared with February, but still was below March 2009, in the depths of the recession.
There is no sign of anything more than a modest increase in demand for gasoline so far this year. Last week's MasterCard SpendingPulse report showed consumption of gasoline for the first two weeks of May running about 1.3% ahead of last year. For the year, consumption has risen about 1%.
Demand is 4% below 2007 levels, according to the MasterCard data, which tallies total gas sales paid by credit card, checks and cash.
Drivers are logging about the same number of miles as they did in 2005. Analysts say the stubbornly high unemployment rate, muted consumer confidence and, until recently, rising gasoline prices have held back driving and gasoline demand.
"The market is jittery and fundamentally weak and that has translated to discretionary gasoline use," said oil analyst and trader Stephen Schork. "It is a tenuous situation out there."
Retail gasoline prices fell again Monday as this month's big drop in oil prices continues to work its way to the pump.
The national average pump price fell 0.8 cents to $2.793 per gallon, according to AAA, Wright Express and Oil Price Information Service. That's down nearly 14 cents from the May 6 price of $2.93. Prices have dropped below $2.50 per gallon in some areas.
Gas prices are 37.5 cents higher than a year ago, but the gap is narrowing quickly.
The Energy Information Administration will released its weekly report on retail gasoline prices later Monday.
Efforts continue to control and clean up the oil spill in the Gulf of Mexico. The spill has not affected prices or interfered with tankers carrying imported crude to Gulf ports or those taking refined products to other parts of the country.
Oil prices, which have fallen more than 19% since hitting an 18-month high of $87.15 per barrel just three weeks ago, rose slightly Monday. Benchmark crude for July delivery gained 17 cents to settle at $70.21 a barrel on the New York Mercantile Exchange.
In other Nymex trading in June contracts, heating oil added 0.26 cent to settle at $1.8993 gallon, and gasoline rose 0.96 cent to settle at $1.9708 a gallon. Natural gas fell 1.8 cents to settle at $4.017 per 1,000 cubic feet.
The Brent crude July contact in London fell 51 cents to settle at $71.17 on the ICE futures exchange.
Associated Press writer Nataliya Vasilyeva in London and Alex Kennedy in Singapore contributed to this report.
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