Gasoline prices rose to a record high Monday, and analysts expect the pain at the pump for motorists to continue this month with average gas prices topping $5 a gallon in most markets, according to the fuel pricing website GasBuddy.com.
Fuel prices at Chattanooga gas stations are up an average of 58% from a year ago, boosting the average price of regular gas in Chattanooga to $4.39 a gallon Monday, or nearly 22 cents a gallon above a week ago and $1.61 a gallon higher than a year ago.
“After a blistering week of gas prices jumping in nearly every town, more bad news is on the horizon,” Patrick De Haan, head of petroleum analysis at GasBuddy, said in a report Monday. “It now appears not if, but when, we’ll hit that psychologically critical $5 national average.”
(READ MORE: Chattanooga changes: Luxury homes moving in where manufacturing once was)
Average gas prices are already above $5 a gallon in nine states, according to GasBuddy.com. In California, the statewide average for regular gas rose Monday to $6.34 per gallon, more than $2 dollars a gallon higher than a year ago, AAA said.
Chattanooga motorists are not being hit quite as hard, with average gas prices locally still 28 cents a gallon below the U.S. average, according to GasBuddy.com.
A separate survey by AAA Auto Club Group, also released Monday, showed Chattanooga with the lowest average gas prices of any market in Tennessee.
The Sam’s Club on Lee Highway had the lowest gas price anywhere in Tennessee with regular fuel priced Sunday at $4.04 a gallon, according to GasBuddy.com. Although the station’s price rose Monday to $4.09 a gallon for regular gas, the Walmart-owned station continued to offer the lowest price in the state, GasBuddy.com reported.
(READ MORE: The myth that won’t die: Price gouging at the pump)
This was the first week GasBuddy.com reported the cheapest price for gas in Chattanooga was above the $4 per gallon mark.
“We’re once again experiencing record-high prices at the pump in Tennessee,” Megan Cooper, spokeswoman for AAA – The Auto Club Group, said in a report. “One silver lining for Tennesseans is that despite the recent spike in prices, Tennessee is currently the ninth-least expensive market in the nation.”
The AAA survey also showed Chattanooga gas prices average 9 cents a gallon less than the statewide average.
But local and global prices for fuel appear to be headed higher. De Haan said gas inventories continue to decline, even with some falloff in demand due to high prices. Analysts said refining capacity is down, and with Russian oil cut off to most of the West due to the war in Ukraine, global energy prices continue to rise.
“Another round of increases at the pump is likely this week as volatile crude oil prices alongside growing demand and tightening supplies continue to affect the market,” Cooper said.
(READ MORE: CBD retail sector takes flight with at least 30 stores in the Chattanooga area)
Tom Kloza, global head of energy analysis for the Oil Price Information Service, which tracks gas prices for AAA, predicted in a report Monday that the national average price of gas will top $5 a gallon “somewhere between this weekend and Father’s Day weekend.”
The price of diesel has risen 11.5 cents nationally in the past week to a record high of $5.62 per gallon.
The cost of a barrel of oil is nearing $120, nearly double the price from last August, as increased oil demand outpaces the tight global supply. Meanwhile, domestic gasoline demand rose last week in the wake of a robust Memorial Day weekend of travel.
According to new data from the Energy Information Administration, domestic gasoline stocks decreased by 700,000 barrels of oil to 219 million barrels last week. Meanwhile, gasoline demand grew from 8.8 million barrels a day to 8.98 million barrels a day as drivers fueled up for Memorial Day weekend travel.
Contact Dave Flessner at dflessner@timesfreepress.com or at 423-757-6340. Follow him on Twitter @dflessner1.