The recent drop in fuel prices may be short-lived as refineries prepare to cut production because of thinning profit margins. An oversupply of fuel and maintenance needs are being cited for the cutbacks.

The production cuts will reportedly put a crimp in fuel supplies and put upward pressure on prices as several refineries are simply reducing crude runs or taking the unusual step of scheduling mid-summer maintenance that typically is scheduled for September or October.

According to an industry analyst, cutting production over the next few weeks could send prices up again, but shouldn't approach last year's prices. George Gaspar, an analyst with Robert W. Baird & Co., told the Milwaukee Journal Sentinel an unexpected surge in the price of crude oil from the current $25 to $26 a barrel to more than $30 is unlikely.

The Oil Price Information Service (OPIS) reports that at least 10 refiners have confirmed cutbacks in production. Those companies citing run cuts are Koch, Tosco, Premcor, Citgo, Ultramar Diamond Shamrock, TotalFineElf, Crown, El Paso, Valero and Sun. OPIS noted that many major refineries who are not listed could be keeping a low profile for fear of negative publicity following months of higher fuel costs.

Many of the refinery cuts may take several weeks to show up in American Petroleum Institute or Department of Energy data.