The national average gasoline price has increased to $3.83 per gallon, marking a peak not seen since 2012.
- Gas prices are surging, adding to inflationary concerns across the U.S. economy.
- On Friday, the price of a gallon of gas nationwide reached $3.83, the highest since September 21, 2012, as per AAA's data.
- The spike comes after U.S. crude oil hit the highest level since 2008.
The national average for gas prices has reached its highest point in nearly a decade, causing a rapid increase that is putting a strain on consumers' finances. Experts predict that the surge may continue with little relief in sight.
On Friday, the national average for a gallon of regular gas was $3.83, the highest since September 21, 2012, according to AAA data. Prices are increasing rapidly, with Friday's average being 10.9 cents higher than Thursday's. Americans are currently paying 26.9 cents more than they did last week and 40.9 cents more than a month ago.
In California, the average price per gallon of gasoline is now $5.07, which is higher than in some other states.
President Joe Biden's administration has been pledging for months to address the high gas prices, but the recent increase has become a source of frustration for him.
The spike in the U.S. oil benchmark, which reached $116 per barrel on Thursday, is due to the rising oil prices. The invasion of Ukraine by Russia and the resulting sanctions on the nation's financial sector are causing concerns about supply shortages in an already tight market.
The U.S. Energy Information Administration states that over 50% of gasoline's cost is determined by oil prices. The remaining costs, such as refining, distribution, marketing, and taxes, make up the rest of the gasoline's price.
According to experts, the only way to curb the increase in crude oil prices may be through demand destruction, which can be achieved through high prices.
According to Wells Fargo, the cost of $130 per barrel of oil translates to $4.60 per gallon of gasoline.
According to Patrick De Haan, the head of petroleum analysis at GasBuddy, the national average may reach $4 this month.
The impact of Russia's oil production or lack thereof on us is likely to continue during the peak of summer driving season, as stated on CNBC's "The Exchange" on Thursday.
On Friday, the stock price settled about 8% higher, reaching its highest level since July 2008 during the trading session.
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