National average gas price hits $5 per gallon for first time
Why it matters: Gas prices are key inflation indicators to the American public, and their persistent climb is a headwind for both consumer spending — as gas bills eat into household budgets — and politicians hoping to stay in power, writes Axios' Matt Phillips.
The big picture: The price of gas soared as Russia's invasion of Ukraine disrupted energy markets and drove up costs, even as the country grapples with decades-high inflation rates.
- Gas prices have been breaking records for months, hitting averages of $4.17 in March and $4.62 at the end of May.
- The Biden administration's policies — including releasing oil from the Strategic Petroleum Reserve and waiving limits on the amount of ethanol in gasoline during summer months — have failed to curb the upward climb of gas prices.
What they're saying: "It’s been one kink after another this year, and worst of all, demand doesn’t seem to be responding to the surge in gas prices, meaning there is a high probability that prices could go even higher in the weeks ahead," said Patrick De Haan, head of petroleum analysis at GasBuddy, which said the national average gas price hit $5 on Thursday.