According to AAA’s Saturday reading, a gallon of ordinary gas now costs $5 on average throughout the country for the first time ever.
The result isn’t surprising. For the past eight weeks, gas prices have been continuously climbing, and this newest milestone represents the 15th consecutive day that the AAA gauge has reached a new high, and the 32nd time in the previous 33 days.
When the latest round of price hikes began on April 15, the national average was $4.07. In less than two months, the latest price reading from OPIS reflects a 23 percent rise.
And increasing fuel costs are costing drivers more than just agony at the pump. According to the government’s inflation report released Friday, they are a significant driver in consumer prices for a wide variety of goods and services growing at the quickest rate in 40 years.
According to a University of Michigan study, consumer confidence hit a new low on Friday due to inflation. Concerns about what the Federal Reserve will do to combat inflation have driven US equities crashing in recent months, wiping away billions of dollars in personal wealth.
While a national average of $5 is novel, $5 gas has grown uncomfortably regular in many parts of the country.
According to data from OPIS, which gathers measurements from 130,000 US gas stations and uses them to generate the AAA averages, 32 percent of stations nationally, or roughly one out of every three, were charging more than $5 a gallon as of Friday. Around 10% of gas stations around the country charge more than $5.75 per gallon.
In Saturday’s reading, the statewide average was $5 a gallon or greater in 21 states plus Washington, DC.
With the start of the summer travel season, demand for gasoline is increasing, while Russian oil imports are being held off owing to the conflict in Ukraine, driving up oil prices on global markets.
According to Tom Kloza, global head of energy analysis for the OPIS, the US national average for gasoline might reach close to $6 later this summer.
California has traditionally had the highest statewide average, with an average of $6.43 per gallon in Saturday’s measurements. Higher prices, however, are felt across the country, not only in California and other high-cost areas.
Oil production and refining capacity in the United States have yet to fully rebound to pre-pandemic levels. Because European prices are considerably higher, certain refineries in the United States and Canada that would ordinarily supply the US market with gasoline are now exporting gasoline to Europe.