In another week of major moves, San Diego gas prices have surged 6¢ in the last week to a new regional average of $2.982 a gallon, less than two cents away from the $3 mark, according to UCAN's gasoline tracking project at www.fueltracker.com

Gas prices have been well below $3 a gallon in San Diego since July 31.

UCAN's Gasoline Project manager, Charles Langley, says the current prices are: "Out of joint with market conditions and point to the hypocrisy of the oil industry's retail pricing. 

UCAN's research shows that 5 months ago, on May 21, the cost of the oil used to make a gallon of gasoline was $1.56 a gallon, or roughly 46% of the cost per gallon when taxes and dealer markups are excluded. At that time, gasoline averaged $3.41 a gallon in San Diego.

In contrast, the cost of the oil used to make a gallon of gas at today's high oil price of $83 a barrel is almost $2 a gallon, or about 2/3 of the cost of a gallon of gasoline before taxes and dealer markup*.

"What this means," says Langley, "is that while the price of oil has increased by 44¢, the retail price of gasoline has decreased by 43¢. Market conditions do not make gas prices go down when oil prices are going up. This is the result of a handful of major refiners deliberately controlling the retail price of gasoline for political reasons."

One month ago, the average price of San Diego regular unleaded gasoline was $2.77 a gallon. Gasoline prices reached their peak on May 9, 2007, at $3.50 a gallon.  UCAN cautions that very high gasoline prices may return with a vengeance, soon.

*The typical gas station dealer makes from 5 to 7¢ per gallon on gasoline. Taxes account for about 62¢ a gallon.