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U.S. consumers are digging deeper in their pockets to fill up at the pump with the average price for gasoline now a record $3.10 a gallon, the government said on Monday.

The national price for regular unleaded gasoline rose 5 cents over the last week and is up 16 cents from a year ago, according to the U.S Energy Information Administration’s weekly survey of service stations.

The latest pump price tops the old record of $3.07 set in September 2005 after Hurricane Katrina disrupted refinery operations and oil production along the Gulf Coast, the EIA said.

The much larger AAA survey showed the price for gasoline at a record $3.07 on Monday.

Higher gasoline costs are cutting into consumer spending, which accounts for about two-thirds of U.S. economic growth.

The EIA has forecast the national gasoline price will stay at or near $3 a gallon for most of the summer, but will not come close to the $4 level that many consumers fear.

Energy experts say rising motor fuel costs reflect the temporary shutdown of several oil refineries, strong petroleum demand, militant attacks on Nigeria’s oil production and higher crude prices.

Guy Caruso, who heads the EIA, said that given the tight supply conditions, OPEC oil ministers needed to boost crude production this summer and not wait until their next planned meeting in September to decide whether to change oil output levels

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Gasoline prices hit a new record at the pump on Monday, but gas futures prices fell on concerns that $3 gas will crimp demand. Oil prices, meanwhile, rose on reports of refinery problems in the U.S. and abroad.

The average national price of a gallon of gas hit $3.073 on Monday, up almost a penny from Sunday’s also record-setting price, according to AAA and the Oil Price Information Service. Gasoline is now well above the previous record of $3.057, set on Sept. 5, 2005, soon after Hurricane Katrina.

But gasoline futures for June delivery fell 5.09 cents to settle at $2.3012 on the New York Mercantile Exchange. Light, sweet crude for June delivery rose 9 cents to settle at $62.46 a barrel on the Nymex.

Heating oil futures fell 1.55 cents to settle at $1.8668 per gallon on the Nymex, while natural gas prices gained 5.3 cents to settle at $7.952 per 1,000 cubic feet.

Brent crude for June settled unchanged at $66.83 a barrel on the ICE Futures exchange in London.

Chip Hodge, energy portfolio manager at John Hancock Financial Securities, in Boston, thinks gasoline futures traders may be reacting psychologically to the fact that pump prices are setting new records.

“You just get a feeling that $3 a gallon. … It’s got to have an impact from a demand standpoint,” Hodge said. “So, maybe there’s a little bit of a selloff on those pressures.”

While oil prices rose on the day, they settled well off their earlier highs on news that Chevron Corp. plans to restart a 42,000 barrels-per-day Nigerian oil facility, said Phil Flynn, an analyst at Alaron Trading Corp. in Chicago.

“There was good news out of Nigeria after a lot of bad news,” Flynn said. “They’re pumping oil again.”

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The New York Times has reported that between 100,000 and 300,000 barrels a day of Iraq’s declared oil production over past four years is unaccounted for.  How could billions of dollars in oil go missing?  Who controls the oil and where do you suppose it has gone?

It has been suggested that some could have been siphoned off through corruption, smuggling or some other big coverup.

We will report more on this major story as it develops.

A service station that offered discounted gas to senior citizens and people supporting youth sports has been ordered by the state to raise its prices.

Center City BP owner Raj Bhandari has been offering senior citizens a 2 cent per gallon price break and discount cards that let sports boosters pay 3 cents less per gallon.

But the state Department of Agriculture, Trade and Consumer Protection says those deals violate Wisconsin’s Unfair Sales Act, which requires stations to sell gas for about 9.2 percent more than the wholesale price.

Bhandari said he received a letter from the state auditor last month saying the state would sue him if he did not raise his prices. The state could penalize him for each discounted gallon he sold, with the fine determined by a judge.

Bhandari, who bought the station a year ago, said he worries customers will think he stopped the discounts because he wants to make more money. About 10 percent of his customers had used the discount cards.

Dale Van Camp said he bought a $50 card to support the local youth hockey program. It would have saved him about $100 per year on gas, he said.

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U.S. gasoline prices shot above $3.00 per gallon on Friday, within striking distance of record highs, as the creaking domestic refinery system strained to keep up with rising demand.

Average retail gasoline prices in the world’s top consumer reached $3.012 a gallon, the AAA travel group said, up more than 30 cents since early April and near the record of $3.057 hit after hurricanes slammed Gulf Coast oil installations in 2005.

This year, companies struggling to retool refineries to meet new environmental standards, have faced longer, more extensive maintenance and serious outages, draining gasoline inventories ahead of peak summer demand.

“The problem this year is our continuing and increasing inability to refine enough gasoline to meet growing demand,” said Geoff Sundstrom of AAA. “I think it is very possible that we will set a new record high price this month.”

U.S gasoline stocks have dropped by 15 percent in three months, with refineries now running at around 88 percent of capacity, well below the 92 percent analysts say is normal this time of year to build up summer gasoline stocks.

“By this point in the season, nationwide gasoline inventories should be building, or at a minimum plateauing,” Stephen Schork of the Schork Group said in a report.

New lower sulfur fuel specifications have forced refiners to increase the complexity of their equipment, making them more prone to outages.

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