Gas prices may surge on 2006 green rules (57 cents by July) [View All]

http://www.msnbc.msn.com/id/10533856/

U.S. consumers recovering from record high gasoline costs last summer may now face a nearly 60-cent price surge next year because of stricter environmental regulations, an industry expert said.

The introduction of lower sulfur requirements for gasoline and diesel combined with a shift in gasoline additives could reduce supplies and create problems for refiners trying to produce fuel to meet the new specifications, according to analyst Trilby Lundberg.

"We expect 2006's price surge to be less severe than 2005's, but more severe than any other year on record," Lundberg said in a report. "While we don't expect retail gasoline to revisit the $3 level in 2006, we do expect a 57 cent hike by July."

Motorists in the world's biggest oil consuming nation saw average gasoline pump prices spike to $3.00 a gallon in September after hurricanes Katrina and Rita shut U.S. Gulf Coast refineries. Prices have fallen to around $2.20 a gallon since then as plants restored operations.