US refiners are increasingly investing in their plants, but the upgrades are not likely to significantly lower gasoline prices, the Wall Street Journal reported Thursday.

Rather than expanding their capacity to process crude oil, which would likely result in greater gasoline supplies, domestic refiners are investing in equipment that can process cheaper crude and overhauling their plants to meet clean fuel mandates, said the report.

That lack of new capacity could keep upward pressure on prices for gasoline, heating oil, jet fuel and other petroleum-based products, it added.

Gasoline prices are averaging a lofty 2.29 dollars a gallon, flat with recent weeks, but up about 40 cents a gallon from a year ago, according to the Department of Energy.

The report said tight refining capacity has been a factor in pushing up pump prices, as refining makes up 18 percent of the retail cost of a gallon of gasoline. The major factor, of course, is the rising price of oil, which makes up 54 percent of the cost of a gallon.

Oil futures for September delivery fell 1.03 dollars to 60.86 dollars a barrel Wednesday on the New York Mercantile Exchange.

US refining capacity is expected to grow only 0.8 percent annually from the beginning of this year through 2007, less than the period from 1998 to 2004, Friedman, Billings, Ramsey, a Washington, D.C. investment bank, was quoted as saying.

No new refinery has been built in the United States in nearly 30 years and capacity gains typically come from extensions to current facilities, according to the report. Many refiners remain reluctant to undertake major new projects for a variety of reasons, including public resistance, expected returns on investment and environmental regulations.

Refining capacity of about 17 million barrels a day falls short of demand in the United States, with a growing amount of imported refined products closing the gap, the report said.