Ahead of the Memorial Day weekend, gas prices are at a four-year high, averaging $4.55 per gallon Friday. File Photo by John Angelillo/UPI | License Photo
Gas prices in the United States were at a four-year high Friday, and those traveling for Memorial Day weekend should expect a blow to their wallets.
The average gas price Friday was $4.55, AAA said, which is more than 50% higher than it was on Feb. 28, before the war with Iran began. It’s the highest price for the holiday weekend since 2022 after Russia invaded Ukraine, CNBC reported. It’s also the highest overall since July 2022.
California has the highest average price at $6.13, and Mississippi has the lowest at $4.01, AA said.
If the Strait of Hormuz, now blocked by the war, doesn’t open soon, average prices could rise to $5 in June, Patrick De Haan, head of petroleum analysis at GasBuddy, told CNBC. But even if it does, prices aren’t likely to fully normalize until 2027.
“Americans will be spending $2 billion more on gasoline over the four-day Memorial Day weekend compared to a year ago, according to GasBuddy estimates, or roughly $22 million more every hour,” De Haan said on X.
U.S. crude oil prices have spiked more than 40% from prewar levels due to the closure of the strait.
Oil prices dropped nearly 7% this week after President Donald Trump said he called off some Iran strikes. But the president has said similar things in the past, only for tensions to escalate again, causing oil prices to spike.
“The president implies that there’s a lot of progress, but I don’t know how many more head fakes we’re going to see,” De Haan said.
David Goldwyn, former State Department special envoy and coordinator for international energy affairs, said global oil inventories are dropping fast. He told CNBC that gasoline, diesel and jet fuel prices will shoot higher within about four to six weeks.
U.S. domestic oil production and reserves could insulate Americans from major shortages, but competition will push up prices, he said.
“The reason we will be looking at $5 gasoline — we’re probably already looking at $6 diesel, but maybe $7 diesel — is because of global competition for products,” Goldwyn said.
This week in Washington
Kevin Warsh takes the oath of office as he is sworn-in as the new chairman of the Federal Reserve by Supreme Court Associate Justice Clarence Thomas in the East Room of the White House on Friday. Photo by Yuri Gripas/UPI | License Photo
