Motorists expecting some relief from the bomb should think again.
Gas prices nationwide could average $ 5 a gallon on June 17, according to Patrick De Haan, an analyst at GasBuddy, which tracks fuel costs nationwide. That’s more than the current national average of $ 4.62 a gallon, which is already a record, according to AAA.
Americans are paying record prices for gasoline as the summer travel season arrives, a problem that weighs on consumers as they make their vacation plans more than increase. COVID-19[feminine] rates, according to a new Morning Consult survey. In a good handful of California stations, the fuel is now running out federal minimum wage of $ 7.25 per hour.
What is driving up prices?
A number of factors are combining to keep fuel prices high. This could equate to months of financial pain for millions of U.S. households, with the typical driver spending an annual fee of approximately $ 4,800 in gasolinemore than $ 2,800 a year ago.
The benchmark Brent crude is now trading at about $ 118 a barrel, or 71% more than a year earlier, according to FactSet. Consumer and business demand has increased as the economy bounced back from the initial COVID-19 pandemic, but refineries are out of step with demand.
Meanwhile, Russia’s war in Ukraine is driving up prices as the US and other nations restrict purchases of Russian energy products. This week, European Union leaders agreed to the embargo most Russian oil imports to trade bloc members by the end of the year.
The Biden administration has tried to reduce gas prices touching the country's Strategic Oil Reserve. But that could only do so much, De Haan said.
"There's a temptation to think that an American politician can do anything, but they have no control over the global levers of supply and demand," De Haan told CBS MoneyWatch. "Look at the Strategic Oil Reserve: it seemed like a big announcement, but prices kept going up."
$ 6 a gallon in August?
Drivers may be paying an average price per gallon $ 6.20 in August, according to JPMorgan analyst Natasha Kaneva in a May 17 report.
Like De Haan, Kaneva explained rising gas prices by pointing to lower supply and higher demand. Refineries tend to produce more gas in anticipation of increased demand over the summer. But gas inventories in the U.S. are declining and are now at their lowest seasonal levels since 2019, he noted.
"American consumers should not wait long for the price relief at the pump until the end of the year," Kaneva predicted.
However, only about half of Americans say they are downsizing because of the high cost of gas, according to a GOBankingRates poll.
Tips for saving money as prices go up
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One of the reasons many drivers may not be shrinking is that current fuel prices are still below their peak in 2008 on an inflation-adjusted basis. In dollars today, the price in 2008 was closer to $ 5.25 a gallon.
As bomb prices rise, some U.S. states are trying to ease the pain. Starting June 1, New York will suspend its tax of 16 cents per gallon of gasoline until the end of the year. Connecticut, Georgia and Maryland have also temporarily raised gasoline taxes, while other states are considering suspending them.
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