Just in time for the summer travel season, gas prices in the U.S. are above $5 per gallon for the first time ever a little over a week after jumping to a record high of $4.67 per gallon.
The national average started the week at $4.87 per gallon before jumping to $5.05 a gallon for regular unleaded gas, according to data from GasBuddy.
It's going to be the most expensive summer we've ever seen," Patrick De Haan of GasBuddy told the Detroit Free Press.
Prices across the country are up about $1.90 a gallon from last year's average.
CNN analyst Andy Lipow expects the national average to hit $5.05 per gallon in the next 10 days.
There's now 10 states with an average gas price of $5 a gallon or higher.
California has the highest average in the nation at $6.34, followed by Nevada at $5.49, Hawaii at $5.47, Oregon at $5.41, and Washington at $5.40 a gallon.
There are five other states with averages above $5 a gallon and another nine states that are on the precipice of also doing so.
We've Had Worse Gas Prices
While the dollar amount of gas is the highest its ever been, when adjusting for inflation the U.S. is far away from experiencing the worst prices in history.
Way back in 2008 prices peaked at $4.11. But when taking inflation into account, gas prices in July 2008 cost what be equivalent to $5.40 per gallon in today dollars, according to a recent report from Kiplinger.
Record gas prices in 2008 were a precursor to the financial crisis of 2008 that sent the U.S. economy into the worst recession since the Great Depression.
The U.S. may be on the brink of inflation as the post-covid economy hasn't had the recovery some expected.
Inflation in the U.S. is at a 40-year high, leading gas prices to jump by 48% year over year, according to the Bureau of Labor Statistics, including an 18% jump between February and April.
So at the same time gas prices are rising, Americans are paying more for everything else, including rents which were up 5.1% year over year in March, according to Rent.com, and groceries, which were also up 10% year over year in March.
The price of new cars is up 12.6% and home furnishings are up by nearly 11%.
Is Relief on the Way?
Despite the rising costs, the U.S. Energy Information Administration says that Americans are spending only a slightly higher percentage of their disposable income on gas than they did in 2015.
"Taken together, the rise in disposable personal incomes for the average American since 2008 has more than offset changes in gasoline prices. Looking ahead in the short run, our projections show gasoline prices in 2022 pushing the ratio of gasoline spending to disposable personal income to its highest level since 2014," the EIA said.
Disposable personal income in 2021 was 76% higher relative to its 2005 level on a per capita basis, according to the government agency.
However, the agency predicts that consumers will have to spend about $450 more for gas this year than they did in 2021.
The Consumer Energy Alliance recently called for ramping up U.S. oil and gas production in an effort to have supply match rising demand during the summer travel season.
