PORTLAND, Ore. (KOIN) – The national average price of gas in the U.S. topped $5 per gallon for the first time in history Thursday, according to GasBuddy.
The tech company, which monitors real-time fuel prices, said this milestone comes after months of gas price increases across the country. The increase has been accelerated by the rise in seasonal demand as more people start to travel, and by constraints borne out of the pandemic.
U.S. gasoline inventories have fallen by more than 25 million barrels, or more than 1 billion gallons, since the start of March, causing gas prices to surge.
The price of oil has also climbed due to escalations resulting from the Russian war on Ukraine, GasBuddy said in a press release. As countries place sanctions on Russia, they choke the Russian oil supply and push down the amount of oil available globally.
Additionally, U.S. refining capacity decreased by some 1 million barrels per day over the last 3 years, according to GasBuddy.
“All of these factors have created an environment ripe for a surge in gas prices, while Americans balk at prices but continue filling up as demand has seen little decline,” the company stated.
The average price of gas in the U.S. has been breaking records since early March.
“It’s been one kink after another this year, and worst of all, demand doesn’t seem to be responding to the surge in gas prices, meaning there is a high probability that prices could go even higher in the weeks ahead,” said Patrick De Haan, head of petroleum analysis at GasBuddy. “It’s a perfect storm of factors all aligning to create a rare environment of rapid price hikes.”
De Haan said the situation could become even worse if there are any unexpected issues at U.S. refineries in 2022, or a major hurricane that impacts oil production or refineries in the summer.
Thursday morning, AAA reported its national average gas price had also reached a record high at $4.970 per gallon. Diesel was also at a new record high of $5.740 per gallon.