(NewsGlobal.com)- Over the weekend, AAA recorded that the national average retail price for regular gasoline hit $5 a gallon for the first time since AAA began tracking the national average 22 years ago.
According to AAA, this record-high average is likely to go even higher as demand continues to outpace the global oil supply.
As of Saturday, the average price at the pump was $5.004 or 63 cents higher than it was a month ago and nearly $2 higher than it was a year ago.
AAA spokesman Devin Gladden said the price of oil, which accounts for 50 percent of what consumers pay at the pump, reached $120 per barrel last week.
Gladden said the current increase is the result of multiple factors, including sanctions placed on Russia, a higher fuel demand as drivers are “reclaiming their travel time” after nearly two years of COVID-imposed lockdowns, and also the official start of hurricane season. Gladden explained that even a threat of a hurricane can shut down crude oil production on the Gulf Coast, leading to a further increase in oil prices.
But even with paying record prices at the pump, Gladden doesn’t expect the driving habits of consumers to change that much heading into the summer vacation season. Instead, he believes consumers will adjust their spending elsewhere, by limiting eating out or how much they spend on discretionary items. As the price at the pump continues to rise, Gladden said, consumers will become more creative in how they save money.
And prices at the pump will continue to rise.
According to Tom Kloza, global head of energy analysis for the Oil Price Information Service (OPIS), the national average in the United States could likely tip above $6 a gallon later this summer.
This view is shared by JPMorgan, which predicts by August the average cost per gallon will surge above $6.
Gas prices have been a key factor in inflation. Last Friday, the Bureau of Labor Statistics reported that the annual US inflation rate surged to 8.6 percent in May, the highest rate since 1981.