UPDATE 1-US gasoline demand rises last week, still down yr/yr

* Demand down 2.5 pct on year in week to May 27

* Demand up 3.5 pct week-on-week

* Prices dip 10 cents in week, still up 38.9 pct yr/yr
(Rewrites throughout, adds background, graphic)

NEW YORK, June 1 (Reuters) - Consumer demand for gasoline
in the United States last week picked up by 3.1 percent,
boosted ahead of the long Memorial Day weekend and by a dip in
pump prices, the MasterCard Advisors' SpendingPulse report
showed on Wednesday.

Average demand in the week to May 27, however, was 2.5
percent lower than the same period last year, as prices hold
high above 2010 levels.

Prices at the pump in the world's top oil consumer last
week dipped by an average of 10 cents a gallon, but were 38.9
percent above year ago levels.

Week-on-week demand over the last four weeks was still down
by 2 percent over the same period last year.

"The overall demand picture has not changed that much over
the past couple of months with demand remaining down 1 to 2
percent year-over-year for the four-week moving average," said
John Gamel, a gasoline analyst at MasterCard Advisors.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

Graphic showing U.S. gasoline demand

link.reuters.com/dah62k
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

Retail gasoline prices averaged $3.82 a gallon compared
with $3.92 a week earlier, the report showed. In the same week
last year prices averaged around $2.75 a gallon.

MasterCard Advisors, a unit of MasterCard Inc (MA.N),
estimates retail gasoline demand based on aggregate sales in
the MasterCard payments system coupled with estimates for other
payment forms including cash and checks.
(Reporting by David Sheppard; editing by Marguerita Choy)