NEW YORK — Oil prices surged 25 percent in less than a month, dredging up memories of last year’s spike. Gas prices could soon eclipse summer highs.
Crude is being tugged higher for different reasons this time, rising primarily as the dollar gets weaker.
Oil is traded in the dollar, which allows investors holding euros or other strong currencies to buy more as the dollar falls.
The dollar hit an annual low Friday, and anyone holding a euro could trade it in for more than $1.50.
By Friday, even the plunging value of the dollar could not push prices higher as it had throughout the week, most likely because there is little to suggest that all of that oil will be used.
Benchmark crude for December delivery gave up 69 cents Friday to settle at $80.50 a barrel on the New York Mercantile Exchange. Oil was trading at less than $70 per barrel to start the month.
Energy demand is extremely weak and the country’s storage tanks are brimming with crude, said Peter Beutel, an analyst at Cameron Hanover.
There are also whispers that the Organization of Petroleum Exporting Countries, which supplies more than 35 percent of the world’s crude, will decide to open up the spigots when it meets in December.
“At some point, the bubble has to burst,” Beutel said.
At the pump, retail gas prices added 2 cents to a new national average of $2.636, according to auto club AAA, Wright Express and the Oil Price Information Service.
In Denver, prices rose 2.6 cents Friday to $2.468 a gallon, up 7.8 cents from a month ago.
