Energy prices slumped Wednesday after the Energy Department reported a higher than expected jump in U.S. gasoline supplies.
Retail gasoline prices have ticked upward since the middle of the month, around the same time that crude futures rose above $75 per barrel for the first time this year.
The rising cost of crude and ensuing production cuts by refiners who are also stung by those prices has helped push gasoline prices higher for 15 days in a row.
The report by the Energy Information Administration Wednesday seemed to wash away fears of tightening supply, at least for now.
Gasoline supplies rose by nearly 2 million barrels though many energy analysts had expected supplies to fall for a third week in a row.
Gasoline futures on the New York Mercantile Exchange fell 3 percent almost immediately, though the prices that people see at the pump rose slightly overnight.
Refiners are buying less crude to make fuel because demand from airlines, trucking companies and motorists remains relatively week.
Diesel and jet fuel demand are both down over the past four weeks compared with last year, the government reported Wednesday.
Unable to pass off cost increase for the crude they must buy, refiners have shut down operations and production is currently at levels more common in the aftermath of a hurricane.
That is part of the reason why retail gasoline prices have been on a two-week upswing.
Even with energy demand low, the falling value of the dollar is driving crude futures higher. When the dollar falls, investors holding euros or other relatively strong currencies can buy more crude because it's bought and sold in dollars.
The dollar gained strength on Wednesday, and crude prices fell.
Benchmark crude for December delivery fell $2.02 to $77.53 a barrel on the New York Mercantile Exchange.
"Even with supply underlying the market, the current interest for energy swirls around the economy and the dollar," said PFGBest analyst Phil Flynn.
Retail gas prices added eight-tenths of a cent overnight to $2.683, according to auto club AAA, Wright Express and Oil Price Information Service. That's 8.7 cents higher than last week and 5.4 cents above what it was at this point last year.
This week marks the first time that retail gas is exceeding prices 12 months ago, partly because prices are rising now, but also because gasoline was tumbling at this time in 2008 as the financial crisis spread.
In other Nymex trading, heating oil fell 5.3 cents to $2.0025 a gallon. Gasoline for November delivery dropped 7.8 cents to $1.9924 a gallon. Natural gas for November delivery fell 23.4cents to $4.323 per 1,000 cubic feet.
In London, Brent crude for December delivery fell $2.11 to $75.81 on the ICE Futures exchange.