For the second time this week gasoline prices have set a new average per gallon record, climbing to $4.087 overnight from $4.086 on Monday, June 30, according to figures compiled by AAA.

The figures, which are 38% higher than those one year ago, put the most expensive gasoline in Alaska at $4.639 and the least expensive in South Carolina at $3.870. Diesel fuel remained unchanged at $4.762 a gallon, a level 60% higher than a year ago.

At the same time, the International Energy Agency (IEA), an influential group that studies oil policy, released a report today arguing that the price of crude oil is not being driven up by oil-market speculation and in turn inflating the pain at the pump.

The report indicated that investment funds in commodity markets have risen in volume from $15 billion in 2003 to the current level of approximately $260 billion. Although many take this as the causal factor in price doubling, the IEA disagrees.

The report said, "There is little evidence that large investment flows into futures markets are causing an imbalance between supply and demand, and therefore contributing to high oil prices." Rather, high crude oil prices are attributed simply to elevated demand and limited supply growth.

Arguing that speculation would lead to an unbalanced market in which either demand would decrease or stockpiles increase, the IEA says oil producing nations cannot quickly increase their output to match rapidly growing consumption in nations like India and China.

The report, however, far from settles a debate that has raged to the halls of Congress where analysts have testified to law makers that while market fundamentals always play a role in price levels, speculation is currently exacerbating those trends and the per gallon price Americans are paying for gasoline.