US gas prices are poised to hit record levels within hours or days as Russia’s invasion of Ukraine further upends the global energy market – leading to higher costs for American motorists.
The national average price of a gallon of gas was $4.07 on Monday afternoon – just four cents off from the all-time high of $4.11 established on July 17, 2008, according to AAA.
And prices at the pump are expected to surge even higher if the US follows through with a ban on Russian oil imports in response to the Ukraine invasion.
That would result in more financial pain for consumers during what is already “the worst energy crisis since the Arab oil embargo,” according to Tom Kloza, the global head of energy analysis for OPIS.
“Until further notice, you’re going to get increases of five to 15 cents a day, maybe more,” Kloza told The Post. “The all-time high of $4.11 back on July 17, 2008, it’s going to be ‘Operation Hot Knife Through Butter’ going through that. In the next 18 hours ago, that falls.”
The Russia-Ukraine conflict has caused further disruptions to an energy market that was already struggling to keep pace with rising demand as economies recover from the COVID-19 pandemic. Oil prices touched decade highs after US officials acknowledged the possibility of a Russian oil import ban.
The national average is already more than $1 higher than it was on the same day one year ago, when a gallon of gas cost $2.77. Prices have jumped a whopping 46 cents over the last week alone.
Gas prices are a major driver for inflation, which was already running red-hot at 7.5% in January – weeks before the invasion began.
Kloza said he expects the national average to hit at least $4.50 per gallon in the days ahead – with higher prices in high-tax areas such as California and New York City. The statewide average in California is already well over $5, with reports of prices as high as $7 at some gas stations.
“I think we’re going to cross into the realm where some people will drive a little bit less than they might have, might cut down on discretionary driving,” Kloza added.
Last week, Gas Buddy analyst Patrick De Haan said existing sanctions targeting Russia’s banking and shipping sectors were “essentially putting a chokehold on Russian oil exports,” which has contributed to the price surge.