Gas prices have soared to new record highs in another hit to the U.S. economy.
According to AAA, the national average price for regular gasoline climbed more than four cents on Tuesday to $4.37 a gallon, topping the prior record of $4.33 set on March 11.
Gas prices are up 17 cents just in the past week.
California, Nevada, and Hawaii have all reached an average of more than $5 per gallon. Diesel fuel also set an all-time record on Tuesday of $5.50 a gallon.
This week’s surge will only add to inflationary pressures that have boosted fears of a national recession, hammered financial markets, and caused Americans’ views on the economy to become fearful.
Gas prices had dropped as low as $4.07 a gallon in April after President Biden ordered the release of oil from emergency reserves and as oil prices cooled off. However, that relief proved to be short-lived, as some industry analysts predicted.
Gas prices have been up about 25% since the first part of 2022.
According to the U.S. Energy Information Administration, gas prices, adjusted for inflation, would have to rise above $5.30 a gallon to break the records set in 2008.
However, this latest surge in gas prices will likely worsen the nation’s inflation problems. Also, the new record highs will not be captured in Wednesday’s closely watched inflation report.
Some analysts have claimed that prices will go even higher in the months ahead. On Sunday, Andy Lipow, president of Lipow Oil Associates, told CNN he expects retail prices will reach $4.50 a gallon in the next week to 10 days. He noted that it might surge even higher in the following weeks.
Oil prices fell Monday to $103.09 a barrel, perhaps taking some pressure off pump prices. However, the cost of gas does not move as quickly, which means any relief will not be seen right away.