US gas prices have hit an all-time high amid Russia’s invasion of Ukraine.
American motorists are now paying an average of $4.173 a gallon when they fill up, according to AAA, previously known as the American Automobile Association.
The previous record, $4.10 a gallon, was set in July 2008 – adjusted for inflation that would be around $5.37 in 2022 prices.
AAA data shows that gas prices increased 10 cents in one day and 55 cents compared to last week.
Gas prices have increased as the Russian invasion of Ukraine continues, with President Joe Biden announcing a US ban on Russian oil imports on Tuesday.
The rising gas prices come amid an increase in the price of crude oil, with the price of international benchmark Brent crude costing $128.99 a barrel on Tuesday – an increase of 4.6 per cent over the last month.
In 2020, Russia was in third place on the list of the largest producers of petroleum products in the world, according to the US Energy Information Administration.
Russia is the world’s largest exporter of crude and oil products combined, making up around seven per cent of the global supply, Reuters reported.
The International Energy Agency announced the coordinated release of crude oil from 31 member countries last week, including the US, Canada, South Korea, Mexico and Germany, the AAA said on Monday.
“Consumers can expect the current trend at the pump to continue as long as crude prices climb,” the organisation said.
“The bigger picture is that supply disruptions are getting worse,” Andrew Lipow, the president of Lipow Oil Associates in Houston, told Reuters. “Nobody wants to touch anything related to Russia.”
Deputy Russian Prime Minister Alexander Novak said on Monday that US and EU bans on Russian oil could lead to prices spiking to more than $300 per barrel.
“We consider $125 per barrel, our near-term forecast for Brent crude oil, as a soft cap for prices, although prices could rise even higher should disruptions worsen or continue for a longer period,” UBS analyst Giovanni Staunovo said, according to the news agency, adding that the invasion of Ukraine could lead to prices surpassing $150 per barrel.
Bank of America analysts have said that a cutoff of Russian oil could lead to a shortage of 5 million barrels per day or more, which could propel prices up towards $200 per barrel.
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