By Tom Doggett
WASHINGTON, July 22 (Reuters) - U.S. retail gasoline prices increased on average 1.6 cents over the last week, hitting $1.41 a gallon for the first since early April, the Energy Department said on Monday.
The rise in fuel costs, up almost 3 cents in two weeks, coincides with a drop in gasoline inventories and higher motor fuel demand.
The latest pump price is up 1.5 cents from a year ago, based on a weekly survey of more than 800 service stations by the department's Energy Information Administration.
That marks the first time this summer driving season that weekly gasoline prices climbed above year-ago levels.
The national price for cleaner-burning reformulated gasoline, which is sold at about one-third of the gas stations in cities and smoggier areas, was up 0.8 cents to $1.469 a gallon, EIA said.
The West Coast had the most expensive regular unleaded gasoline, though the average price in the region was down 0.8 cents to $1.541 a gallon.
The Gulf Coast states had the cheapest fuel, with the average price up 1.5 cents to $1.315 a gallon.
San Francisco maintained its top spot among major cities in fuel costs, with the price down 1 penny to $1.669 a gallon.
The best deal at the pump was again found in Houston, where gasoline was up 0.2 cents to $1.32 a gallon.
The report also showed gasoline prices down 2.1 cents in Los Angeles to $1.545, down 0.9 cents in Chicago to $1.479, up 2.1 cents in New York City to $1.448 and up 6.8 cents in Denver to $1.448.
The biggest year-on-year change in city pump prices was in San Francisco and New York City, where gasoline costs have each dropped 17 cents a gallon.
The EIA said it expects the average pump price to peak at around $1.43 later this summer, far from last year's record weekly price of $1.70.
Separately, the nationwide price for diesel fuel increased for the fifth week in a row, rising 1.1 cents to $1.331 a gallon, down 4 cents from a year ago.
Truckers in New England paid the most for diesel fuel at $1.398 a gallon, up 1.4 cents from the prior week. The lower Atlantic states had the cheapest diesel, up 1.6 cents to $1.273 a gallon.