US Gas Prices Jump Again to Near-Record Highs
US Gas Prices Jump Again to Near-Record Highs

By Naveen Athrappully

Gas prices in the United States are once again moving along an upward trajectory, with May 9 prices coming close to the record high seen in March.

The average price of regular unleaded gas was $4.328 per gallon as of May 9, according to the American Automobile Association (AAA). The highest recorded average price was $4.331 per gallon on March 11.

The May 9 price is up by 3.19 percent from the last week’s price of $4.194 per gallon, and almost 5 percent higher than the previous month’s price of $4.123 per gallon. When compared to $2.962 per gallon a year ago, current prices are more than 46 percent higher.

Nationwide, regular gas price averages were the highest in the state of California at $5.829 per gallon, followed by Hawaii at $5.282, and Nevada at $5.117. In all other states, unleaded fuel was priced at less than $5 per gallon.

The state with the lowest price was Georgia with $3.844 per gallon, followed by Missouri with $3.896, and Oklahoma at $3.917. In eight states, gas was less than $4 per gallon.

The jump in prices follows a decline in stocks and a rise in consumption. According to data from the U.S. Energy Information Administration (EIA), total domestic stocks of gasoline were at 228.6 million barrels as of April 29, a 2.2 million barrel decline from the previous week. In contrast, gasoline demand rose slightly to 8.86 million barrels per day from the earlier 8.74 million barrels per day.

Diesel prices edged down on May 9.

“According to GasBuddy data, diesel prices *for the time being* have started to give up ground and are down 0.4c/gal today to $5.518/gal,” oil and refined products analyst Patrick DeHaan wrote in a May 9 Twitter post.

While many people are blaming surging gas prices on the Russia–Ukraine war, Dan McTeague, president of Canadians for Affordable Energy and a leading gas expert, doesn’t believe that the conflict is the sole reason.

“Some people think all this is because of Russia, but nothing could be further from the truth,” he said, according to The Canadian Press. “It is a matter of fundamentals. There was less supply and more demand before and that hasn’t changed. … During the summer, gasoline prices tend to detach from oil prices—they go much higher.”

Gas prices aren’t only rising because of increasing oil prices in the international markets, but also because of surging refining costs. Processing margins for oil refiners, which averaged about $10.50 per barrel between 1985 and 2021, jumped to a record high of almost $55 last week, according to Bloomberg.

That’s pushed up prices of gasoline, jet fuel, and diesel well above crude. Refined oil products have risen 30 to 140 percent since the Russian invasion of Ukraine, compared to just 15 percent for crude oil.

Although West Texas Intermediate (WTI) crude is trading at about $100 to $110 per barrel, jet fuel is being traded at $275 per barrel in New York Harbor, with diesel trading at $175 per barrel and gasoline at $155 per barrel.

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