US gasoline prices to rise despite slowdown-EIA

WASHINGTON, April 16 (Reuters) - U.S. drivers should not be fooled into thinking a weak economy and less gasoline use will help lower pump prices any time soon, the federal Energy Information Administration said on Wednesday.

"Even though U.S. gasoline demand has been lower than year-ago levels so far this year, EIA still expects that rising gasoline demand over the next few months will still drive retail prices higher," the agency said in its weekly review of the oil market.

The national price for regular, self-service gasoline hit a record $3.39 a gallon this week, according to the Energy Department's forecasting arm.

"This year's upcoming spring and summer are expected to see retail gasoline prices rise even further from current high levels," the agency said.

While high crude oil prices have been mostly to blame for pushing gasoline costs to record levels, increasing seasonal gasoline demand will likely raise retail pump prices to $3.50 a gallon and above, even if gasoline use is down from year ago levels, the EIA said.

"The simple fact that more and more gasoline will be used over the next few months will probably be enough to cause retail gasoline prices to increase, even if crude oil prices begin declining, as EIA is currently projecting," the agency said.

The switch-over by refineries to making less-polluting gasoline for the summer is more costly and will also help to raise gasoline prices, the agency said.

The EIA said if crude oil prices stay above an average $104 a barrel in May and June, consumers could pay more than $3.60 a gallon for gasoline. U.S. oil prices hit a record of almost $115 a barrel on Wednesday at the New York Mercantile Exchange. (Reporting by Tom Doggett; Editing by Marguerita Choy)