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U.S. gasoline prices surged by as much as $0.26 in just one week to hit over $4.80 per gallon on Monday as inventories continue to drop and refinery capacity is lower than before COVID, according to fuel-savings app GasBuddy.
As of June 6, the national average price of regular gasoline stood at a record-high $4.865 per gallon, per AAA data, and it looks like it’s a matter of days before the national average hits the $5 psychological threshold.
This is an additional headache for the Biden Administration which has been seeking—to no avail—to bring prices down via various measures, including massive releases of crude from the Strategic Petroleum Reserve (SPR) or increased ethanol blending requirements.
Americans will vote with gasoline prices in mind in the mid-term elections in November, a new ABC News/Ipsos poll found this weekend. Just 27 percent of Americans approve of President Biden’s handling of the gasoline prices, with only a bare majority of Democrats—51 percent—approving his policies to handle gasoline prices. Gasoline prices will be an extremely important issue for voters in the mid-terms for 48 percent of Americans—the highest percentage an issue has garnered for being “extremely important.” Another 26 percent of Americans see gasoline prices as “very important” election issue, the poll showed.
There is no relief in sight for the pain at the pump, Patrick De Haan, head of petroleum analysis at GasBuddy, said on Monday.
“After a blistering week of gas prices jumping in nearly every town, city, state and area possible, more bad news is on the horizon. It now appears not if, but when, we’ll hit that psychologically critical $5 national average,” De Haan said.
“Gasoline inventories continue to decline even with demand softening due to high prices, a culmination of less refining capacity than we had prior to Covid and strong consumption, a situation that doesn’t look to improve drastically anytime soon,” he added.
Motor gasoline inventories in the U.S. are now about 9% below the five-year average for this time of year, the EIA’s latest data show. Distillate fuel inventories, which include diesel, are about 24% below the five-year average for this time of year. Diesel prices also set a new record on June 6, at $5.645 per gallon.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.