Gasoline prices rose above $4 per gallon for the first time in all the states of the U.S. Even states like Oklahoma, Kansas, and Georgia, which were holding out, saw the prices shoot up overnight, as per American Automobile Association (AAA).
Oil price: all-time high
As per Bloomberg News, prices averaged $6.021 per gallon in the most expensive state. This is a new record, while five other states have prices above $5 a gallon.
The highest ever prices less than two weeks before the peak summer driving season starts a burden on consumers and a challenge for President Joe Biden. The President’s decision to release emergency reserve crude oils have translated too little relief to consumers at the pump partly due to the lack of refining capacity for crude oil.
While California tops at $6 per gallon, all states are now had pump oil prices above $4 a gallon.
According to an email to Bloomberg, Ellen Edmonds, the spokesperson of AAA, said that it was too early to predict how the price increase would impact drivers and the summer travel plans. It is historically seen that people, irrespective of hikes, take planned trips but take other measures to offset the higher pump prices.
This month, Mark Finley, a fellow at the Rice University Baker Institute for public policy, said that the burden of price rise at pumps affects the lower-income family heavily. These families spend a bigger portion of their income on fuel, and they are less likely to use electric vehicles.
According to a forecast by the government, an average U.S. household will spend an average of $450 more this year on an inflation-adjusted basis for gasoline compared to the previous year.
The higher wages ensure that gasoline expenses as a percentage of disposable income will remain above the average since 2015, as per the report. A few physical and financial metrics that include data for low fuel stockpiles suggest that gasoline prices will rise further during the summer.
The average price of diesel in the U.S. is now $5.573 per gallon is also a record high as per AAA.
