Last week, American drivers confronted a stunning leap in gasoline prices. A gallon of gas spiked to near $3 a gallon in many places and, in a few places for brief periods, prices soared as high as $6 a gallon. And that is just for unleaded regular, the cheap stuff. Or what used to be the cheap stuff.
In the Washington area, regular gasoline averaged $2.89 per gallon Friday, according to AAA, up from $2.76 on Thursday, $2.34 a month ago, and $1.87 this time last year.
Energy prices have been the overwhelming driver of inflation in the Washington area in the past year, even before Hurricane Katrina. Consumer prices rose 4 percent in the Washington-Baltimore region in the 12 months ended in July, the Labor Department said. If you take out energy prices, however, prices rose 3.3 percent.
The largest part of that differential is caused by gasoline, which was up 19.4 percent in the past year, according to the price index, and up 61 percent in the past three years. It's not the only fuel price that's been rising. Piped natural gas was up 5 percent in the 12 months ended in July. Natural gas prices, too, are spiking because of the hurricane, as about a quarter of the nation's natural gas is piped through the New Orleans area. That could be particularly significant if elevated prices remain in place into the winter, when people use gas to heat their houses.
-- Neil Irwin