Rising gasoline prices across the U.S. are setting new records, adding to financial hardships that many are already facing amid the pandemic and high inflation.
That’s right: Fuel costs are higher than they’ve ever been in United States history, and those high prices are expected to last a while.
This article first appeared in the Data Drop Newsletter, a periodical newsletter that focuses on data to tell important local stories. Sign up for it right here.
Those numbers have declined slightly over the last few days, but they’re still high. The average cost per gallon in Michigan is $4.215 as of March 16, which is up 86 cents from last month, and more than $1.40 from this time last year.
The fast price hike for consumers everywhere followed Russia’s invasion of Ukraine, which caused oil prices to rise in a matter of days. Here’s why: Russia is the world’s second largest oil exporter, and several nations have imposed sanctions on the country amid the war. Russia’s oil exports are now under what amounts to a ban, as shippers are refusing Russian oil, countries are turning away Russian tankers and banks are refusing to extend credit to Russia.
The literal cost-per-gallon has never been this high in U.S. history, but when those costs are adjusted for inflation, that’s not quite the case. Let’s take a look at how those numbers have changed over time.
Comparing US gas prices throughout history
In January of 1929, the cost at the pump was 21 cents per gallon of gas. When adjusted for inflation using the value of the U.S. dollar in 2022, that cost was equivalent to $3.48 per gallon today -- which is higher than our average cost was one year ago.
Gasoline costs rose fairly steadily throughout the last century, with notably steep increases in the early 1980s and the early 2000s.
A significant jump occurred between 1978 and 1981, when the cost rose from 63 cents per gallon to $1.31 per gallon. Then, between 2002 and 2008, the cost rose steadily from $1.36 per gallon to $3.27 per gallon.
Below, you’ll find an interactive chart of the average cost-per-gallon in the U.S. from 1929 through 2022, both adjusted for inflation and not adjusted.
How long will these prices last?
Regardless of the outcome of the war, gas prices are expected to remain relatively high for consumers for a while.
Denton Cinquegrana with the Oil Price Information Service told Local 4 last week that this situation has some “staying power.”
“Even if Putin decides to withdraw, it will take time to unravel all that. And, at the same time, you have U.S. producers looking to increase production. But, again, you can’t snap your finger, wave a wand, and all of a sudden you’re producing more oil,” Cinquegrana said. “This, unfortunately, has some staying power. Wish I had better news for consumers. This is going to stick around for a while.”
Experts say the pain at the pump being felt by people across the U.S. could just be the beginning.
“One thing no one is talking about is diesel prices,” Cinquegrana said. “Diesel prices are quickly approaching $5 a gallon. Everything moves around by truck or train by the use of diesel.”
7 tips to save money, improve fuel efficiency
- Stay at half: Keep at least a half-tank of fuel at all times, especially when there is a risk of shortages.
- Check online: Apps and websites such as GasBuddy show local gas prices, making it easy to find good prices in your area or if you need to travel. Kroger and Costco offer discounted gas, but typically a membership or enrollment in discount program is needed. At Meijer, you get 10 cents off every gallon.
- Obey speed limits: When you drive, follow the speed limits and drive smoothly. Your driving habits can play a significant role in fuel economy. Speeding up from 55 to 75 mph is like moving from a compact car to a large SUV. Beyond fuel concerns, speeding is, of course, a safety concern.
- Drive evenly: Avoid hard acceleration and braking whenever possible. In our tests, frequent bursts of acceleration and braking reduced average vehicles mileage by 2 to 3 mpg.
- Skip the premium: Save money and skip premium gas unless it is required. If there is only mid-grade, or premium fuel available, this will work fine in a car that is rated for regular gasoline.
- Check tire pressure: Having tires with lower pressure than what is recommended on your doorjamb sticker can affect performance, tire longevity, and fuel economy.
- Use public transport: Instead of driving, find a SMART Bus route near you.