Across the country, including the Chicago area, gas prices are climbing, but why is gas becoming so expensive so quickly?
Prices at the pump were rising long before Russia invaded Ukraine and have spiraled faster since the start of the war. The U.S. national average for a gallon of gasoline has soared 45 cents a gallon in the past week and topped $4.06 on Monday, according to auto club AAA.
The price of regular broke $4 a gallon on Sunday for the first time in nearly 14 years and is now up nearly 50% from a year ago.
The United States is the world's largest oil producer — ahead of Saudi Arabia and Russia — but it is also the biggest oil consumer, and it can't meet that staggering demand with domestic crude alone.
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The U.S. imported 245 million barrels of oil from Russia last year — about 8% of all U.S. oil imports — up from 198 million barrels in 2020. That's less than the U.S. gets from Canada or Mexico but more than it imported last year from Saudi Arabia.
The increasingly violent Russian attack on Ukraine has increased calls to cut off Russia from the money it gets from oil and natural gas exports. Europe is heavily dependent on Russian gas.
President Joe Biden has been reluctant to ban Russian oil, fearing it could further fuel inflation heading into the midterm elections this November.
Many Republicans and a growing number of Democrats in the House and Senate, including House Speaker Nancy Pelosi, D-Calif., have endorsed banning Russian crude as a way to put more pressure on Russian President Vladimir Putin. The White House hasn’t ruled out a ban.
Talk of a ban on Russian oil has led U.S. officials to consider other sources that are currently limited. In what was supposed to be a secret trip, senior U.S. officials traveled to Venezuela over the weekend to discuss the chance of easing oil sanctions on the major crude-exporting country.
GasBuddy, which tracks prices down to the service-station level, said Monday that the U.S. was likely to break its record price of $4.10 a gallon, but that does not account for inflation. In today's terms, the record price would be equal to about $5.24 after accounting for inflation.
“Forget the $4 per gallon mark, the nation will soon set new all-time record highs and we could push closer to a national average of $4.50," said GasBuddy analyst Patrick De Haan. “We’ve never been in this situation before, with this level of uncertainty. ... Americans will be feeling the pain of the rise in prices for quite some time."
As of Monday morning, the average price of gas in the Chicago area was $4.614, according to numbers published by AAA. That's up from the $4.525 average a day earlier.
Cook County was seeing the highest averages in the metro area, AAA reported. Some gas stations in Chicago were already reaching near $5 per gallon.
Across the state, the average price of gas had climbed to $4.304, remaining well above the national average of $4.065.
According to CNBC, the national rate of $4.009 on Sunday marked the highest level since July 2008, not adjusted for inflation.
While Illinois remains among the highest in the country, several West Coast states are seeing prices even higher. California saw totals of $5.343 and Nevada saw prices at $4.590.
“This is a milestone that was hard to imagine happening so quickly, but with bipartisan support of severe sanctions on Russia, is not exactly surprising – it is the cost of choking off Russia from energy revenue,” Patrick De Haan, head of petroleum analysis for GasBuddy, said in a statement. “As Russia’s war on Ukraine continues to evolve and we head into a season where gas prices typically increase, Americans should prepare to pay more for gas than they ever have before. Shopping and paying smart at the pump will be critical well into summer.”
According to GasBuddy, prices are expected to continue rising, potentially to a record high, through the summer months. Current forecasts predict the national average could reach $4.25 per gallon by Memorial Day.