As the summer driving season is about to begin, demand for gasoline is dropping because of the pain at the pump.
Data from the Energy Information Administration shows that demand on a four-week rolling basis has hit its lowest level in three years. Demand is down compared to a year ago.
Prices at gas stations across the US have hit record after record over the past two weeks, diminishing hopes for a driving season that approaches pre-COVID-19 levels.
The average price of a gallon of gas in the US hit $4.79 on Tuesday, about 50% higher than a year ago. Regular gas prices have never hit this level. In California, prices can be over $6.
The high gas prices could cause demand destruction, which could lead to higher prices.
The average US gas price could surpass $6 a gallon this summer as driving season gets fully underway, according to a note from JP Morgan.
US retail price could surge another 37% by August to a $6.20/gal national average, according to analysts.
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