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Americans are now paying the most at the pump on record as energy prices surge, contributing to rampant inflation that’s hitting all areas of the economy.
The national average for a gallon of regular gas rose to $4.173 on Tuesday, according to AAA.
The prior record was $4.114 from July 2008, not adjusted for inflation.
Tuesday’s new high follows a sharp spike in gas since Russia invaded Ukraine, sending oil prices surging.
Consumers are paying 55 cents more than one week ago, and about 72 cents more than last month.
Oil prices, meantime, jumped Sunday to prices last seen in 2008.
West Texas Intermediate crude futures, the U.S. oil benchmark, traded as high as $132.07. International benchmark Brent crude hit $139.13. But both settled well below those highs during Monday’s trading session.
On Tuesday, WTI stood 2.9% higher at $122.76 per barrel, while Brent added 3.5% to trade at $127.40.
Experts expect oil prices — and therefore prices at the pump — to remain elevated.
Russia is a key oil and gas producer and exporter, and the country’s war on Ukraine is disrupting the global market.
“Given Russia’s key role in global energy supply, the global economy could soon be faced with one of the largest energy supply shocks ever,” Goldman Sachs said Monday in a note to clients.
Western officials’ sanctions have so far focused on hitting the country’s financial institutions, but possible energy sanctions have been left on the table as an option.
Additionally, the market is already exhibiting self-sanctioning as buyers shun Russian oil.
“Estimates vary but it is probably fair to say that should an import ban be imposed on Russia the additional volume that becomes unavailable would be relatively limited,” said Tamas Varga at brokerage PVM.