Topline
Average U.S. gas prices are now more than $5 per gallon in over a dozen states, according to the latest American Automobile Association data, as prices continue to climb to new record levels during the busy summer driving season.
A customer pumps gas at an Exxon gas station in Miami last month.
Key Facts
Maine ($5.00 per gallon), Massachusetts ($5.00) and New Jersey ($5.02) all topped the $5 mark Tuesday, according to AAA.
The three states join 10 others where gas prices are over $5, AAA reported: California ($6.37), Nevada ($5.53), Hawaii ($5.48), Oregon ($5.46), Washington ($5.46), Illinois ($5.45), Alaska ($5.42), Michigan ($5.17), Arizona ($5.16) and Indiana ($5.15).
Overall, AAA estimates national average gas prices are $4.919 Tuesday, a five-cent increase from Monday and a 61% jump compared to a year ago.
Fuel price tracker GasBuddy estimates the national average gas price is $4.943 a gallon, also reporting 13 states are past the $5 marker.
Key Background
Average U.S. gas prices first surged to a record price of $4.104 on March 15, according to GasBuddy, just three weeks after Russia invaded Ukraine. Prices climbed $4.33 in March before stabilizing and then soaring in May, setting a new record of $4.374 May 16 and steadily climbing since. The surging prices can largely be traced to surging crude oil prices and limited supply: U.S. gas inventory is down 27 million barrels compared to February, according to the Energy Information Administration. AAA spokesperson Andrew Gross said in a statement Monday that driver demand has remained high despite the high prices at the pump.
What To Watch For
When national average gas prices surpass $5. Patrick De Haan, GasBuddy’s head of petroleum analysis, tweeted Monday he expected prices to pass the milestone by Friday, though he said Tuesday modest dips in oil prices may push that back. Natasha Kaneva, head of the global commodities strategy team at JPMorgan, wrote in a note last month average gas prices could reach $6.20 a gallon nationwide by August.
Tangent
Amid the record prices, the White House said last week President Joe Biden plans to travel to Saudi Arabia to meet with Crown Prince Mohammed bin Salman, a major policy reversal for Biden that’s drawn significant pushback. Biden is expected to ask for Saudi Arabia to further increase oil production after the Saudi-led OPEC+ alliance said last week it would increase production by 648,000 barrels per day in July and August.
Further Reading
Why Gas Prices Seem To Go Up Faster Than They Go Down (Forbes)
Biden Has ‘Only Bad Options’ for Bringing Down Oil Prices (New York Times)
Source: https://www.forbes.com/sites/dereksaul/2022/06/07/gas-now-tops-5-a-gallon-in-these-13-states/