According to data from the AAA, formerly the American Automobile Association, gas prices in all 50 U.S. states have hit an average of at least $4 per gallon for the first time in history, sending parents across the country into panic mode.
It is happening as crude oil prices trade near $110 a barrel in the global market, and while that price is below the recent highs witnessed back in March, the raised national average gas price could indicate higher highs ahead of the busy summer travel season.
According to the AAA, refiners tend to switch to the more expensive "summer blend" of gasoline, and the seasonal formulation can add up to $0.10 per gallon, depending on the location.
High cost of oil driving high pump prices for consumers
Andrew Gross, who is the AAA spokesperson, told NBC News in a statement that the high cost of oil, the key ingredient in gasoline, is driving these high pump prices for consumers. Gross added that even the annual seasonal demand dip for gasoline during the lull between spring break and Memorial Day, which would typically help lower gas prices, has no effect this year.
Separate data measured by the gas price tracking group GasBuddy.com on Wednesday, May 18, showed one state, Oklahoma, still one cent below the $4 average. Its data also showed the average price in California had climbed above $6 for the first time.
Patrick De Haan, head of petroleum analysis at GasBuddy, in a news release, said that liquid fuels have turned into liquid gold, with prices for diesel and gasoline spiraling out of control with little power to harness them as the imbalance between supply and demand globally continues to widen with each passing day.
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Canada also hit hard by gas price spikes
De Haan added that Russia's oil increasingly remains out of the global market, crimping supply while demand rebounds ahead of the summer driving season. And it is not just the United States that is having this problem, as gas prices north of the border in Canada also hit an all-time high this week, reaching $2 per litre for the first time in history, according to GasBuddy.
The Biden administration is doing its part to address the gas price spikes, tapping the country's strategic petroleum reserve and waiving the restrictions on selling higher ethanol E15 gas. Analysts said, however, that the impact of those measures may be too little to counter broader market forces, with domestic gasoline inventories trending lower than a year ago.
De Haan told KSDK that there is little, if any, good news about fuel prices heading into the summer season, and the problem could become even worse should they see an above-average hurricane season, which could knock out refinery capacity at a time they badly need it as refined product inventories continue to plummet.
