The average price of gasoline in the United States reached $ 5 a gallon for the first time in history on Saturday, adding more pressure to decades of high inflation that has become politically costly for the Biden administration.
The new $ 5 milestone, reported by the AAA Motor Club, means U.S. gasoline prices have risen more than two-thirds last year and more than doubled since Joe Biden took office.
Rising energy prices have fueled a substantial part of the continuing rise in inflation, which accelerated once again in May and is now maintained at the fastest annual rate since December 1981. The The latest consumer price index, released on Friday, showed that prices rose by 1% last month alone, or 8.6% compared to the same period last year.
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The administration has repeatedly tried to blame Russian President Vladimir Putin, pointing to the country’s invasion of Ukraine as the main reason for the sharp rise in crude oil prices, which in turn has led to rising fuel costs.
Brent’s international oil benchmark has risen more than $ 120 a barrel since Moscow ordered troops to enter Ukraine, from lows close to $ 10 a barrel during the depths of the pandemic two years ago.
In recent months, the White House has announced the release of record volumes of oil from a federal emergency reserve in order to alleviate the supply crisis, and has also called on Saudi Arabia and other countries in the United States. OPEC + significantly increase supply.
The White House has also blamed US oil companies for their reluctance to drill.
Speaking in Los Angeles on Friday, the president told ExxonMobil, the largest oil company in the United States, that he had “made more money than God this year.”
U.S. oil company executives say the requirement for Wall Street investors to spend an extraordinary profit on high oil prices in dividends, not new production, has slowed spending on new supplies.
Biden and other senior officials, including Treasury Secretary Janet Yellen, have repeatedly said that tackling high inflation is the administration’s “number one priority”, a message they have focused on as rates rise. President’s approval has reached historic lows.
Republican lawmakers seized the opportunity to use Yellen this week in testimony in Congress, forcing her to defend the Biden administration against charges that have fueled price pressures through its spending.
Biden also urged the Federal Reserve to do whatever it takes to counteract high inflation, emphasizing its independence as it proceeds to raise interest rates rapidly. Since March, the US central bank has raised its benchmark rate by 0.75 percentage points and is expected to implement another half-point rate hike next week, after delivering the first since 2000. in May.
A series of such increases are now expected during the second half of 2022, as the Fed aims to shift its monetary policy “rapidly” to a “neutral” environment that no longer stimulates demand.