Gas prices have been on the rise, and don’t appear to be leveling off anytime soon. But, as crazy as it may seem, gas prices have been higher before.
On Thursday, the national average price of gas jumped to $5 a gallon, according to GasBuddy. This jump doesn’t come as a surprise for most — gas prices have been on the rise for months amid supply chain problems, increased demand for fuel, and Russia’s invasion of Ukraine. President Biden even authorized the largest-ever oil reserve release from the country’s strategic reserves to combat rising prices.
And if $5 for a gallon of gas seems like a lot to you, that’s just the national average — some states are already paying well above that to fuel up. One gas station in Northern California has some of the highest prices in the nation, with GasBuddy reporting a gallon of regular gasoline selling for $9.63 on Monday. As of Thursday, prices for that Chevron station are no longer listed on GasBuddy’s platform.
Though paying $5 at the pump seems alarming, Americans have faced worse, believe it or not.
It was the summer of 2008, just before the U.S. economy hit a massive recession, prices at the pump peaked at $4.11, according to Kiplinger, a business and finance news site.
When adjusted for inflation, using the Bureau of Labor Statistic’s calculator, $4.11 in July 2008 is equivalent to $5.40 today (based on the most recent data from April 2022). We’ve already surpassed another notable gas spike, which happened in 1981 when gas prices jumped to a then-record of $1.31. Adjusted for inflation, that’s equal to $4.13 in today’s prices.
Still, gas prices don’t seem to be slowing down anytime soon. The U.S. has been steadily setting records for gas prices since March when the national average price of regular gas broke $4 for the first time since 2008.
“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, in Thursday’s press release. “It’s a perfect storm of factors all aligning to create a rare environment of rapid price hikes. The situation could become even worse should there be any unexpected issues at the nation’s refineries or a major hurricane that impacts oil production or refineries this summer.”
Earlier this week, while speaking to the Senate Finance Committee, Treasury Secretary Janet Yellen took heat for inflation that’s near 40-year highs, with gasoline prices up almost 50% since last year.
“Given the global nature of these markets, it’s virtually impossible for us to insulate ourselves from shocks like the ones that are occurring in Russia that move global oil prices,” Yellen said.
Data from AAA and GasBuddy shows, however, that Americans are still fueling up, despite the high prices.