Pump Watch: Gas Prices Expected to Remain Above $3 a Gallon

As gas prices continue to hover above $3 a gallon, Essex-Middle River Patch is launching a new weekly column—Pump Watch—that will examine the cost of filling up and where the cheapest places are to buy gas.

The average cost of regular unleaded in Maryland as of Sunday was $3.09 a gallon, which is unchanged from a week ago, but 43 cents more than a year ago, according to the latest survey by AAA.

According to the survey, the national average price of regular grade gasoline was $3.13 Sunday, up a penny from a week ago.  Prices remain 4 cents higher than a month ago, 49 cents above year-ago prices, yet 98 cents below the record of $4.11 set in summer 2008.

This average price comes at a time when supply remains high and the average price of crude oil fell to $85.58 a barrel on the close of trading on Friday, compared to $89.03 a barrel from the same time a week ago. This came in part due to Friday’s announcement that Egyptian President Hosni Mubarack would step down. Crude oil cost $74 a barrel at the same time a year ago.

Analysts caution that lower prices may be temporary due to concerns the violence and protests may spill over to other parts of the Middle East.

AAA Mid-Atlantic spokesman Ragina C. Averella said the higher prices for gas at a time when they typically decrease is not a good sign for motorists hoping to save at the pump as temperatures begin to rise.

“Motorists continue to feel pain at the pumps well into the winter with gas prices trending above the $3 mark nationally for the past seven weeks,” said Averella in a statement. “These higher prices come at a time when demand is low due to the winter weather that has blanketed most of the country, which typically sends prices retreating this time of year.

“Looking ahead, if we’re seeing higher gas prices now, analysts believe as demand increases with the peak driving season set to begin in April, prices will only increase—certainly not good news for motorists.”

Looking ahead, in its short-term energy outlook, the U.S. Energy Administration says it expects the price of U.S. crude oil to average about $93 a barrel in 2011, $14 higher than the average price last year.

For 2012, EIA projects that U.S. crude prices will continue to rise, averaging $98 per barrel.  The agency expects regular grade gasoline to average $3.15 a gallon in 2011, 37 cents per gallon higher that the 2010 average, and $3.30 a gallon in 2012, with prices expected to average about 5 cents per gallon higher in each year during peak driving season (April through September).

Here are the top five cheapest places to purchase gas in the Essex-Middle River area, according to MarylandGasPrices.com