Gasoline hits $3.50 a gallon

Record high comes as crude oil prices also spiking

Oil tankers are moored near the Chevron refinery on Monday in Richmond, Calif. Gasoline prices reached a new record Monday, averaging .50 a gallon, just as crude oil also hit a new high for the sixth consecutive day, closing above 17 a barrel.

? Rising gasoline prices tightened the squeeze on drivers Monday, jumping for the first time to an average $3.50 a gallon at filling stations across the country with no sign of relief.

Crude oil set a record for the sixth day in a row – this time closing above $117 a barrel – after an attack on a Japanese oil tanker in the Middle East rattled investors.

In Lawrence, a gallon of unleaded averaged $3.388 early Monday, 1.5 cents higher than a day earlier, according to AAA and the Oil Price Information Service.

“It’s killing us,” said Jean Beuns, a New York cab driver who estimated he now makes $125 to $150 less per month than in the fall because of costlier gas. “And it was so quick. Every day you see the price go up 5, 6, 10 cents more.”

Diesel prices at the pump also struck a record high of $4.20 a gallon, according to AAA and the Oil Price Information Service. That’s sure to add to truckers’ costs and drive up the price of food, clothing and other goods shipped by truck.

“You and I are going to pay more,” said Bob Costello, chief economist of American Trucking Associations. “Exactly how much : I can’t tell you, but it’s got to show up.”

Gasoline and diesel prices are expected to keep climbing as they trace the path of crude. Oil prices are charging ahead along with a host of commodities that are enticing speculators seeking hedges against a weakening dollar.

Light, sweet crude for May delivery rose to a record $117.76 a barrel on the New York Mercantile Exchange before settling at $117.48, up 79 cents from Friday’s close.

Gas jumped more than a nickel over the weekend and is up 23 percent from a year ago. Drivers in New Jersey are paying the least, while drivers in California pay the most, $3.86 a gallon for regular unleaded.

The Energy Department predicted earlier this month that monthly average gasoline price will peak at more than $3.60 per gallon in June and could even reach $4.

“It’s uncharted territory,” said Tom Kloza of the Oil Price Information Service, of Wall, N.J. “I don’t think we’re done, but I have to believe we’re in the eighth or ninth inning” of price increases.

Energy Department data show Americans used about 1 percent less gas in the four weeks ended April 11 than they did a year earlier.

That change, while not drastic, is significant, Mariano Gurfinkel, project manager at the Center for Energy Economics at the University of Texas at Austin, who expects per-capita demand to drop further this summer unless gas prices fall.

Americans will continue to drive, but some may change their summer vacation destinations as gasoline costs continue to make a bigger dent in their pocketbooks, Gurfinkel said.

Crude oil rose Monday after the 150,000-ton tanker Takayama was struck off the coast of Yemen as it headed for Saudi Arabia, its Japanese operator, Nippon Yusen K.K., said.

Kyodo News agency reported that the Japanese tanker was fired on by a rocket launcher from a small boat. None of the ship’s 23 crew members was injured, but several hundreds of gallons of fuel leaked before a 1-inch hole in the tanker was repaired, the company said.

Militants in Nigeria renewed their attacks on oil facilities in the south of the African nation. Nigeria is a major supplier to the U.S., and attacks in the past two years have cut nearly a quarter of the country’s oil output.