Average US gas price hits $5 for first time - CNN

He predicted US inflation would rise. Hear what he thinks about a recession

A For Sale sign is displayed in front of a house in Washington, DC, on March 14, 2022.

US Microsoft founder, Co-Chairman of the Bill & Melinda Gates Foundation, Bill Gates, poses for a picture on October 9, 2019, in Lyon, central eastern France, during the funding conference of Global Fund to Fight AIDS, Tuberculosis and Malaria. - The Global Fund to Fight AIDS, Tuberculosis and Malaria on October 9, 2019, opened a drive to raise $14 billion to fight a global epidemics but face an uphill battle in the face of donor fatigue. The fund has asked for $14 billion, an amount it says would help save 16 million lives, avert "234 million infections" and place the world back on track to meet the UN objective of ending the epidemics of HIV/AIDS, tuberculosis and malaria within 10 years. (Photo by JEFF PACHOUD / AFP) (Photo by JEFF PACHOUD/AFP via Getty Images)

U.S. Federal Reserve Board Chairman Jerome Powell takes questions after the Federal Reserve raised its target interest rate by three-quarters of a percentage point to stem a disruptive surge in inflation, during a news conference following a two-day meeting of the Federal Open Market Committee (FOMC) in Washington, U.S., June 15, 2022.

Rosalind "Roz" Brewer, president and chief executive officer of Sam's Club, speaks during the Wal-Mart Stores Inc. annual shareholders meeting in Fayetteville, Arkansas, U.S., on Friday, June 7, 2013. Wal-Mart Stores Inc., which kicked off its annual meeting today, approved a new $15 billion share buyback program. Photographer: Sarah Bentham/Bloomberg via Getty Images

New York CNN Business —

For the first time ever, a gallon of regular gas now costs $5 on average nationwide, according to AAA’s Saturday reading.

The record is hardly a surprise. Gas prices have been rising steadily for the last eight weeks, and this latest milestone marks the 15th straight day that the AAA reading has hit a record price, and the 32nd time in the last 33 days.

The national average stood at $4.07 when the current run of price increases began April 15. The current price reading from OPIS represents 23% increase in less than two months.

And the rising gasoline prices is doing more than just causing pain at the pump for drivers. They are a major factor in the prices paid by consumers for a full range of goods and services rising at the fastest pace in 40 years, according to the government’s inflation report Friday.

Inflation caused consumer confidence to hit a record low on Friday, according to a survey by the University of Michigan. Worries about what the Federal Reserve will do to battle inflation has sent US stocks plunging in recent months, wiping out billions in household wealth.

While a $5 national average is new, $5 gas has become unpleasantly common in much of the country.

Data from OPIS, which collects the readings from 130,000 US gas stations used to compile the AAA averages, showed that 32% of stations nationwide, nearly one of every three, were already were charging more than $5 a gallon in readings Friday. And about 10% of stations across the nation are charging more than $5.75 a gallon.

The statewide average was $5 a gallon or more in 21 states plus Washington DC in Saturday’s reading.

$6 gas could be next

And gas prices are unlikely to stop there. With the summer travel season getting underway, demand for gasoline, coupled with Russian oil shipments cut off due to the war in Ukraine, oil prices are soaring on global markets.

The US national average for gasoline could be close to $6 later this summer, according to Tom Kloza, global head of energy analysis for the OPIS.

“Anything goes from June 20 to Labor Day,” Kloza said earlier this week about the demand for gas as people hit the road for long-anticipated getaways. “Come hell or high gas prices, people are going to take vacations.”

The highest statewide average has long been in California, where the average stood at $6.43 a gallon in Saturday’s readings. But the pain of higher prices is being felt across the country, not just in California or other high-priced states.

Cheap gas hard to find

That’s partly because the cheapest price wasn’t all that cheap — the $4.47 a gallon average price in Georgia gives it the cheapest statewide average. Less than 300 gas stations out of 130,000 nationwide were charging $4.25 a gallon or less in Friday’s reading from OPIS. For purposes of comparison, before the run-up in prices earlier this year, the record national average for gas had been $4.11, set in July 2008.

And even in some states with cheaper gas prices, such as Mississippi, lower average wages mean that drivers there have to work more hours to earn the money needed to fill their tank than drivers in some of the higher priced gas states, such as Washington.

There are some early signs that people are starting to cut back on their driving in the face of the higher prices, but it’s still a modest decline.

The number of gallons pumped at stations in the last week of May was down about 5% from the same week a year ago, according to OPIS, even though gas prices have risen more than 50% since then. The number of US trips by car has slipped about 5% since early May, according to mobility research firm Inrix, although those trips are still up about 5% since the start of the year.

The chief concern is that consumers will cut back on other spending to keep driving which could push an economy already showing signs of weakness into recession.

Numerous reasons for record prices

Beyond the strong demand for gasoline, there is also a supply problem that’s driving up the price of both oil and gasoline. Russia’s invasion of Ukraine, the sanctions on Russia imposed in the United States and Europe since then is a major factor, since Russia was among the world’s leading oil exporters. But it is only part of the cause.

Oil is a commodity traded on global markets. The United States has never imported significant amounts of oil from Russia, but Europe has traditionally been dependent on Russian exports. The EU’s recent decision to ban oil tanker shipments from Russia sent oil prices soaring globally.

The price of a barrel of crude closed above $120 a barrel Friday, up from just less than $100 a month ago. Goldman Sachs recently predicted the average price for a barrel of Brent crude, the benchmark used for oil traded in Europe, will be $140 a barrel between July and September, up from its prior call of $125 a barrel.

Other factors beyond Russia’s withdrawal from the global market are limiting supply. OPEC and its allies have sharply cut back oil production as demand for oil crashed in the early months of the pandemic, as much of the world’s businesses shut down and people stayed close to home. Global oil futures briefly traded in negative territory due to lack of space to store the glut of oil. Some oil producing nations slashed production in an effort to support prices, and some of that production is back online but not all of it.

US oil production and refining capacity also have not fully recovered to the pre-pandemic levels. And because prices are even higher in Europe, some US and Canadian refineries that would normally supply the US market with gas are exporting gasoline to Europe.

Many oil companies have been slow to increase production, despite the high price that the oil could fetch, instead using those soaring profits to buy back their own stock in an effort to raise their share price. ExxonMobi has announced it intends to repurchase $30 billion of its stock, more than its total capital spending budget for the year.

– CNN’s Matt Egan and Michelle Watson contributed to this report.

Gas prices are high and up another 7 cents nationwide. Here is the ...

How much is gas in my state? How does it compare nationwide?

The cost for a gallon of gas in the United States continues to reach all-time highs, as the national average jumped nearly 7 cents Thursday morning.

The nationwide average for regular gas is now $4.32 a gallon, according to AAA. On Wednesday, the cost was $4.25, once again eclipsing the previous all-time record of $4.11 set in July 2008. When adjusted for inflation, that would be around $5.25 today.

Diesel prices are also at record highs, with the average cost at $5.06 a gallon, up nearly 18 cents from Wednesday's average of $4.88. Thursday is the first time diesel has ever been over $5. Before this week, the previous record of $4.84 was also in July 2008, which would be around $6.19 in today's dollars.

(How much are you paying for gas? How is it affecting you and your budget? Share your thoughts with USA TODAY on the form below or use this form if you have photos of your local gas station's prices to share for possible inclusion in future stories, photo galleries and social media posts.)

SAVE MONEY:How to save money at the pump as gas prices hit all-time high with Russian invasion of Ukraine

RISING PRICES:Russia's war in Ukraine has driven up gas prices. Will rising oil costs increase food prices next?

Highest gas prices in California

California continues to have the most expensive gas in the country at $5.69, and remains the only state to average over $5. California also became the first state to average over $6 for a gallon of diesel at $6.21.

Gas still under $4 a gallon in 12 states

As of Thursday, only 12 states have averages under $4, most of which are located in the Midwest. Kansas has the cheapest cost for gas at $3.82.

Why are gas prices so high?

Russia's invasion of Ukraine remains a large factor behind rising prices, as sanctions put on Russia include the country's selling of crude oil, which is one of the biggest factors in determining gas prices. Russian crude oil only accounts for 3% of U.S. imports, but it has a pivotal role because it produces crude oil that is valuable to U.S. refineries.

President Joe Biden's decision to ban the U.S. import of all Russian energy products on Tuesday is expected to result in prices continuing to climb.

"Oil prices play a leading role in pushing gas prices higher. Consumers can expect the current trend at the pump to continue as long as crude prices climb," AAA said on Monday.

GAS TIPS: Gas prices are soaring – here's what you can do to keep your costs down

GAS QUESTIONS: Why are gas prices rising so quickly? And how high are they expected to get?

When will gas prices go down?

It is unknown when prices will drop, but there is some hope as the cost for oil dropped. As of Wednesday night, U.S. crude oil costs $111.05 a barrel, nearly $15 less than Tuesday, according to Bloomberg. Brent crude, the international standard, costs $111.14 a barrel, $19 less than Tuesday.

"It doesn't mean lower prices YET- it means a slowdown in the increases. stations won't have to go up quite as much," Patrick De Haan, head of petroleum analysis at fuel-savings app GasBuddy, said in a tweet on Wednesday.

INFLATION RATE:Inflation climbed at fastest pace since 1982 last month as consumer prices rose 7.9%, CPI report shows

DAILY MONEY NEWSLETTER: Money tips and advice delivered right to your inbox. Sign up here

Average gas prices per state

Wondering how much gas costs in your state? Here is how much it is across the country by fuel type:

Alabama gas prices

Regular: $4.13

Mid-grade: $4.413

Premium: $4.755

Diesel: $5.024

Alaska gas prices

Regular: $4.68

Mid-grade: $4.791

Premium: $4.984

Diesel: $4.933

Arizona gas prices

Regular: $4.548

Mid-grade: $4.768

Premium: $5.033

Diesel: $5.024

Arkansas gas prices

Regular: $3.901

Mid-grade: $4.176

Premium: $4.47

Diesel: $4.774

California gas prices

Regular: $5.694

Mid-grade: $5.834

Premium: $5.976

Diesel: $6.212

Colorado gas prices

Regular: $3.953

Mid-grade: $4.269

Premium: $4.558

Diesel: $4.565

Connecticut gas prices

Regular: $4.475

Mid-grade: $4.714

Premium: $4.931

Diesel: $5.219

DC gas prices

Regular: $4.50

Mid-grade: $4.864

Premium: $5.056

Diesel: $5.09

Delaware gas prices

Regular: $4.285

Mid-grade: $4.594

Premium: $4.829

Diesel: $5.103

Florida gas prices

Regular: $4.346

Mid-grade: $4.644

Premium: $4.959

Diesel: $5.052

Georgia gas prices

Regular: $4.269

Mid-grade: $4.561

Premium: $4.9

Diesel: $5.091

Hawaii gas prices

Regular: $4.81

Mid-grade: $5.003

Premium: $5.268

Diesel: $5.083

Idaho gas prices

Regular: $4.296

Mid-grade: $4.448

Premium: $4.654

Diesel: $4.877

Illinois gas prices

Regular: $4.57

Mid-grade: $4.901

Premium: $5.292

Diesel: $4.886

Indiana gas prices

Regular: $4.256

Mid-grade: $4.557

Premium: $4.869

Diesel: $4.939

Iowa gas prices

Regular: $3.921

Mid-grade: $4.044

Premium: $4.474

Diesel: $4.734

Kansas gas prices

Regular: $3.817

Mid-grade: $4.076

Premium: $4.318

Diesel: $4.606

Kentucky gas prices

Regular: $4.042

Mid-grade: $4.334

Premium: $4.641

Diesel: $4.892

Louisiana gas prices

Regular: $4.132

Mid-grade: $4.405

Premium: $4.721

Diesel: $4.917

Maine gas prices

Regular: $4.319

Mid-grade: $4.571

Premium: $4.827

Diesel: $5.22

Maryland gas prices

Regular: $4.302

Mid-grade: $4.649

Premium: $4.913

Diesel: $5.187

Massachusetts gas prices

Regular: $4.354

Mid-grade: $4.60

Premium: $4.828

Diesel: $5.135

Michigan gas prices

Regular: $4.261

Mid-grade: $4.541

Premium: $4.876

Diesel: $4.915

Minnesota gas prices

Regular: $3.954

Mid-grade: $4.145

Premium: $4.483

Diesel: $4.765

Mississippi gas prices

Regular: $3.997

Mid-grade: $4.254

Premium: $4.581

Diesel: $4.876

Missouri gas prices

Regular: $3.85

Mid-grade: $4.083

Premium: $4.356

Diesel: $4.648

Montana gas prices

Regular: $4.002

Mid-grade: $4.242

Premium: $4.507

Diesel: $4.702

Nebraska gas prices

Regular: $3.917

Mid-grade: $3.999

Premium: $4.375

Diesel: $4.659

Nevada gas prices

Regular: $4.872

Mid-grade: $5.054

Premium: $5.247

Diesel: $5.16

New Hampshire gas prices

Regular: $4.29

Mid-grade: $4.56

Premium: $4.824

Diesel: $5.186

New Jersey gas prices

Regular: $4.379

Mid-grade: $4.657

Premium: $4.848

Diesel: $5.222

New Mexico gas prices

Regular: $4.179

Mid-grade: $4.462

Premium: $4.732

Diesel: $4.961

New York gas prices

Regular: $4.466

Mid-grade: $4.722

Premium: $4.957

Diesel: $5.275

North Carolina gas prices

Regular: $4.181

Mid-grade: $4.486

Premium: $4.825

Diesel: $5.079

North Dakota gas prices

Regular: $3.89

Mid-grade: $4.113

Premium: $4.347

Diesel: $4.609

Ohio gas prices

Regular: $4.091

Mid-grade: $4.378

Premium: $4.716

Diesel: $4.967

Oklahoma gas prices

Regular: $3.852

Mid-grade: $4.111

Premium: $4.342

Diesel: $4.677

Oregon gas prices

Regular: $4.722

Mid-grade: $4.872

Premium: $5.079

Diesel: $5.291

Pennsylvania gas prices

Regular: $4.436

Mid-grade: $4.728

Premium: $5.007

Diesel: $5.397

Rhode Island gas prices

Regular: $4.352

Mid-grade: $4.638

Premium: $4.881

Diesel: $5.111

South Carolina gas prices

Regular: $4.076

Mid-grade: $4.38

Premium: $4.708

Diesel: $5.004

South Dakota gas prices

Regular: $3.946

Mid-grade: $4.068

Premium: $4.418

Diesel: $4.601

Tennessee gas prices

Regular: $4.112

Mid-grade: $4.414

Premium: $4.757

Diesel: $5.03

Texas gas prices

Regular: $4.004

Mid-grade: $4.288

Premium: $4.59

Diesel: $4.888

Utah gas prices

Regular: $4.304

Mid-grade: $4.467

Premium: $4.652

Diesel: $4.922

Vermont gas prices

Regular: $4.311

Mid-grade: $4.528

Premium: $4.751

Diesel: $5.14

Virginia gas prices

Regular: $4.241

Mid-grade: $4.578

Premium: $4.896

Diesel: $5.06

Washington gas prices

Regular: $4.707

Mid-grade: $4.868

Premium: $5.057

Diesel: $5.274

West Virginia gas prices

Regular: $4.118

Mid-grade: $4.367

Premium: $4.657

Diesel: $5.022

Wisconsin gas prices

Regular: $4.038

Mid-grade: $4.326

Premium: $4.74

Diesel: $4.751

Wyoming gas prices

Regular: $3.987

Mid-grade: $4.192

Premium: $4.436

Diesel: $4.683

Follow USA TODAY reporters Jordan Mendoza and Kelly Tyko on Twitter: @jordan_mendoza5 and @KellyTyko.

High gas prices affecting you? Share your thoughts and photos with USA TODAY

Are you changing your driving habits because of rising gas prices? Share your thoughts with USA TODAY for possible inclusion in future coverage. If you don't see the form below or want to submit photos, please use this form.

National average price of gas tops $4 a gallon

The national average price for gas has topped $4 a gallon for the first time in over a decade as gas costs continue to soar in the wake of Russia's invasion of Ukraine.

As of Sunday afternoon, the national average of a regular gallon of gas was $4.009, according to AAA. That's up 8 cents from Saturday and up 40 cents from last week. The U.S. hit the $4 national average a day earlier than analysts expected.

The record high for the national average is $4.11, set on July 17, 2008, according to AAA.

Patrick De Haan, head of petroleum analysis at fuel-savings app GasBuddy, said in a tweet Sunday the national average could reach up to $4.10 by Tuesday, adding to the possibility the record could be broken by the end of the week.

►Gas prices and inflation have you down?: Here's how to sell your car to Carvana, Autonation

►Gas prices are up: What can Biden do to lower costs at the pump amid Russia's invasion of Ukraine?

GasBuddy's 2022 gasoline forecast predicts the average price of gas will reach $4.25 by May and will remain over $4 likely until November.

"GasBuddy expects that gasoline prices will continue to rise in the days ahead, and could be just days away from setting a new all-time record high and continuing to rise through summer," the company said.

The average cost is also the highest since May 2011, when it was $3.90, according to the U.S. Energy Information Administration.

The rising cost of gas in recent weeks comes as Russia's invasion of Ukraine has applied pressure on global oil markets. The lifting of coronavirus mask mandates throughout the U.S. could also be a factor as consumer spending and travel ramp up.

"American and (European Union) sanctions are having a severe impact on Russia's ability to sell crude oil, thus crude prices have skyrocketed," De Haan told USA TODAY.

Most expensive gas in the U.S.

California continues to shatter its record of highest gas prices and the most expensive gas prices in the country, averaging $5.28 per gallon in the Golden State. California is the only state with an average cost over $5.

In Mono County, which borders Nevada and home of popular tourist destination Mammoth Mountain, the average price of gas is $5.95. But other places are seeing higher cost; A gas station in Los Angeles had prices at $6.99 per gallon. The cheapest average cost of gas is in Missouri and Oklahoma at $3.60.

Here are the most expensive average costs of gas per gallon in the country, per AAA:

California ($5.28)

Hawaii ($4.69)

Nevada ($4.52)

Oregon ($4.46)

Washington ($4.40)

Alaska ($4.36)

Illinois ($4.26)

Connecticut ($4.21)

New York ($4.20)

Pennsylvania ($4.17)

Contributing: Mike Snider

Follow Jordan Mendoza on Twitter: @jordan_mendoza5.

Gas prices are the most expensive in US history, breaking record ...

After rising dramatically following Russia's invasion of Ukraine, the price of gas reached a record, topping a high that had stood for nearly 14 years.

As of Tuesday morning, the average national price for a gallon of regular gasoline touched $4.17, according to AAA, the highest price ever, not accounting for inflation. That was up from $4.07 on Monday and $3.61 a week earlier.

The previous high was $4.11 on July 17, 2008, according to AAA. That would come to around $5.25 today when adjusted for inflation.

The cost for diesel is nearing the record of $4.84, also set in July 2008. The price for a gallon of diesel is $4.75, more than double what it was in October 2020.

PRICES CONTINUE TO RISE: Latest update shows another record set on March 9

One of the main components of the rising costs is the invasion of Ukraine by Russian armed forces. Tom Kloza, chief global analyst for the Oil Price Information Service, told USA TODAY that Russia is the second-largest oil producer in the world, behind the United States.

Your questions answered: Why are gas prices rising so quickly? How high are they expected to get?

'Be prepared for months of high prices': How to save money as gas prices smash records

For subscribers: Are oil and gas companies price gouging consumers at the pump?

The Associated Press reported a barrel of U.S. crude oil cost $119.40 per barrel, and Brent crude, the international standard, cost $123.21 per barrel on Monday.

Gas prices are likely to keep rising. The fuel-savings app GasBuddy projects prices will probably average $4.25 in May and stay over $4 until November.

“Americans have never seen gasoline prices this high, nor have we seen the pace of increases so fast and furious. That combination makes this situation all the more remarkable and intense, with crippling sanctions on Russia curbing their flow of oil, leading to the massive spike in the price of all fuels: gasoline, diesel, jet fuel and more," Patrick De Haan, head of petroleum analysis at GasBuddy, said in a statement Monday.

De Haan said in a tweet Sunday the chances of a $5 nationwide average are "somewhat remote" but remain a small possibility.

Most expensive gas in the USA

As is historically the case, California has the most expensive prices in the country, averaging $5.44 a gallon as of Tuesday. The Golden State is the only one to average more than $5 a gallon.

The most expensive county for gas is Mono County, which borders Nevada and includes the tourist destination Mammoth Mountain. The average price is $6.02.

Some gas locations reported prices about $2 over the state average. Stations in Los Angeles and San Francisco sell regular gas for more than $6 per gallon, some reaching nearly $7. In the city of Gorda, about 140 miles south of San Francisco on the coast, one station charged $7.59, KSBW reported.

As of Tuesday morning, 28 states have average prices over $4. Only five states – South Dakota, Kansas, Missouri, Oklahoma and Arkansas – averaged less than $3.80. The cheapest state to get gas is Oklahoma at $3.71.

Here are the most expensive average costs of gas per gallon in the country, per AAA:

California ($5.44)

Hawaii ($4.71)

Nevada ($4.67)

Oregon ($4.58)

Washington ($4.54)

Alaska ($4.50)

Illinois ($4.42)

New York ($4.36)

Connecticut ($4.35)

Pennsylvania ($4.31)

Contributing: Mike Snider, Brett Molina

Follow Jordan Mendoza on Twitter: @jordan_mendoza5.

Gas prices in the US hit a record as Russia continues to invade ...

New York (CNN Business) US drivers have never paid this much for gasoline. The price for a gallon of regular gas now stands at $4.17, according to AAA.

That breaks the previous record of $4.11 a gallon that has stood since July 2008.

As Russia continues its military offensive in Ukraine , gas prices are rising faster than they have since Hurricane Katrina slammed into oil platforms and refineries along the US Gulf Coast in 2005.

Gas prices rose 10 cents since early Monday, gaining three of those cents overnight, according to the Oil Price Information Service, the firm that collects and calculates prices for AAA. The price data is calculated on a dynamic basis with pricing information from 130,000 US gas stations. OPIS confirmed Monday evening that a new record of $4.14 a gallon had been reached. But enough stations raised their prices further later Monday and early Tuesday to lift the average to $4.17.

The $4.17 average means that the price is up 55 cents a gallon in just the last week, and 63 cents, or 18%, since February 24, the day Russian forces invaded Ukraine

Gas price spikes won't be stopping any time soon, said Tom Kloza, global head of energy analysis for the OPIS. Wholesale gasoline prices rose between 1 cent to as much as 12 cents a gallon in trading Monday in different markets across the United States. Those increases will be passed onto to drivers at the pump in relatively short order.

"I think we'll hit $4.50 a gallon before it turns around," said Kloza. "The risk is how bad this gets, how long this goes on. Even $5 a gallon nationwide is possible. I wouldn't have predicted that before the fighting started."

Why gas prices are surging

Russia is one of the world's major oil exporters, with most of its output going to Europe and Asia. Russian oil made up only 2% of US imports in December, according to Energy Department data. But oil is priced on global commodity markets, so the impact is felt everywhere.

The sanctions placed on Russia's economy following the invasion have so far exempted oil exports . But traders have been reluctant to purchase Russian oil because of sanctions on the country's banking sector. Many are also worried about finding oil tankers willing to dock in Russian ports.

That's what investors who are bidding on contracts for future deliveries of oil are betting could happen, which has been driving up the price of crude, Kloza said.

"If this becomes a real ban, not just a de facto ban, the concern is it's going to last longer," he said.

Where gas is most expensive ... and cheapest

In some parts of the United States, $4 a gallon gas remains rare. A large swath of central states, from North Dakota south to Texas, had averages in Tuesday's reading from AAA no higher than $3.86 a gallon.

But prices are rapidly increasing everywhere. The lowest statewide average is in Oklahoma, where unleaded stands at $3.72 a gallon. But that's up 42 cents, or 13%, in the last week.

As of Monday morning, gas was $4 or more in 28 states, plus Washington, DC. All of the East Coast states other than South Carolina, as well as the three West Coast states, Nevada, Arizona, New Mexico, Utah, Idaho, Illinois, Indiana, Michigan Alaska and Hawaii had statewide averages at or above $4. And it is likely that other states will cross the $4 a gallon mark soon, as South Carolina, West Virginia and Alabama are all within a couple of cents from that mark in Tuesday's reading.

The highest prices are in California, where the statewide average stood at $5.44 a gallon.

Battling inflation

The rapid increase in gas prices is putting a real squeeze on many household budgets. It comes at an unfortunate time as overall inflation is up 7.5% over the last 12 months, the biggest year-over-year gain in consumer prices in nearly 40 years. Gasoline stations advertise prices in large numbers that are much more visible for consumers than many other prices.

The average US household uses about 90 gallons of gas a month. So just the 63-cent increase in the average price since the start of the war in Ukraine will cost that typical household about $55 more a month than they were spending on gas before this latest spike.

And it's not as if prices were low before this recent surge in gas prices. A year ago, the average price for a gallon of regular stood at $2.77 a gallon, so drivers are paying $1.40 a gallon more now. That comes to nearly $126 a month more, or about $1,500 a year, if prices stay that elevated for that long.

Still the $4.11 record that was set in 2008 would be the equivalent to $5.25 a gallon in today's dollars when adjusted for inflation. And vehicles as a group are more fuel efficient today than they were in 2008, with far more electric and plug-in hybrid vehicles, and better fuel economy overall than the fleet of cars on the road 14 years ago.

Two more states hit $5 a gallon gas prices - CNN

New York (CNN) The gas price spike keeps getting worse.

The national average jumped to $4.87 a gallon on Monday, according to AAA. That's up 25 cents in the past week and 59 cents in the past month.

There are now 10 states where the average price of gasoline is $5 a gallon or higher, with the latest being Michigan and Indiana. Washington, DC, is also above $5.

New Jersey, Pennsylvania and Massachusetts are just pennies away. Georgia is the only state with an average below $4.30 a gallon.

In total, more than one out of every five gas stations nationwide are now charging more than $5 a gallon for regular, and just over half are charging $4.75 or more.

Read More

Why the average gas price is at $4.99 a gallon and how high it'll go ...

SCHWEDT, GERMANY - MAY 03: In this aerial view, huge tanks for crude oil of the PCK oil refinery, which is majority owned by Russian energy company Rosneft and processes oil coming from Russia via the Druzhba pipeline, stands on May 3, 2022 in Schwedt, Germany. European Union member states are to meet later this week to possibly agree on a phased-in ban on oil imports from Russia after Germany, which relies heavily on Russian energy imports, recently said it was willing to support a ban. (Photo by Hannibal Hanschke/Getty Images)

How to save money on gas by being more fuel efficient

MILL VALLEY, CA - MARCH 03: A customer pumps gasoline into his car at an Arco gas station on March 3, 2015 in Mill Valley, California. U.S. gas prices have surged an average of 39 cents in the past 35 days as a result of the price of crude oil prices increases, scheduled seasonal refinery maintenance beginning and a labor dispute at a Tesoro refinery. It is predicted that the price of gas will continue to rise through March. (Photo by Justin Sullivan/Getty Images)

Gas prices over the $6 dollar mark are displayed at a gas station in Sacramento, Calif., Friday, May 27, 2022. (AP Photo/Rich Pedroncelli)

New York CNN Business —

Another day, another record for US gas prices.

The US average for the price of a gallon of regular gas hit $4.96 according to the most recent reading from AAA Wednesday. It marked the 12th straight day, and the 29th time in the last 30 that gas has set a record in America.

For much of the country, $5 gas is already here.

There are now 16 states plus Washington DC with averages of $5 or above. Idaho, Ohio and Pennsylvania became the latest states to cross that threshold. The highest priced state remains California, with a state average of $6.39 a gallon.

And the worst is yet to come for drivers.

With the summer travel season just getting underway, demand for gasoline, coupled with the cut-off of Russian oil shipments due to the war in Ukraine, is sending oil prices higher on global markets.

The national average for gasoline could be close to $6 by later this summer according to Tom Kloza, global head of energy analysis for the OPIS, which tracks gas prices for AAA.

“Anything goes from June 20 to Labor Day,” Kloza said about the demand for gas as people hit the road for long-anticipated getaways. “Come hell or high gas prices, people are going to take vacations,”

While the United States has never imported significant amounts of oil from Russia, the commodity is traded on global markets, and Europe was greatly dependent on Russian exports. The EU’s recent decision to ban oil tanker shipments from Russia as sent oil prices soaring on those global markets.

The price of a barrel of crude is now above $120 a barrel, up from just less than $100 a month ago, And prices continued to climb in early trading Wednesday. Goldman Sachs predicted the average price for a barrel of Brent crude, the benchmark used for oil traded in Europe, will be $140 a barrel between July and September, up from its prior call of $125 a barrel.

There are stations and states where gas is cheaper. About 20% of stations nationwide still are selling gas for less than $4.50 a gallon. But even in many states where gasoline is cheaper, such as Mississippi, lower average income can mean drivers have to work longer to fill-up their tanks than in some high gas price states such as California.

How much are drivers willing to pay before they cut back on driving? So far the number of gallons pumped at stations in the last week of May was down only about 5% from the same week a year ago, even though gas prices rose more than 50% during the same period. The number of US trips by car has slipped about 5% since early May, according to mobility research firm Inrix, although those trips are still up about 5% since the start of the year.

The concern is that consumers will cut back on other spending to keep driving the miles they want or need to drive, which could drive an economy already showing some signs of weakness into recession.

– CNN’s Matt Egan contributed to this report

High gas prices in US reach nationwide average of $5 for first time

For the first time ever, the average gas price across the U.S. is $5 a gallon.

On Saturday, the AAA reported the $5 nationwide average – which comes amid a surge in fuel costs, with record-breaking prices over the past few months.

The national average gas price jumped 19 cents in the past week. And prices at the pump are up $1.93 from this time last year.

Saturday marked the first time the U.S. reached a $5 average for nationwide gas prices – but it's not highest record when inflation is taken into account. In July 2008, gas prices peaked at $4.11 a gallon, which would be equal to about $5.40 a gallon today.

Still, the whopping $5 average has shaken the country and contributed to the growing cost of living crisis, as Americans face the highest rate of inflation in 40 years.

My gas-guzzling Chevy taught me a lesson: It's paying off as inflation and gas prices get ugly

Highest rate of inflation in 40 years:New level driven by gas, grocery prices and high rent in May

According to the AAA, the state reporting the highest gas prices on Saturday was California – with an average of $6.43 a gallon. The lowest state average is currently in Mississippi, with a price of $4.52 a gallon.

Experts note that global oil prices are rising largely because of the ongoing war in Ukraine. In the U.S., costs are also rising due to limits on refining capacity because of some shut downs during the pandemic and increased fuel demand overall – especially as many Americans traveled over Memorial Day weekend.

What's everyone talking about?:Sign up for our trending newsletter to get the latest news of the day

After Russia invaded Ukraine in February, the price of oil climbed in 2022's first quarter as countries that rely heavily on Russia for energy scrambled for alternative fuel sources amid uncertainty. The benchmark for global oil prices, Brent crude, averaged at $102.23 a barrel during the first quarter – 67% higher than during the same period last year, according to the Associated Press.

Record profits despite record prices:Oil giants reap record profits as war rages in Ukraine, energy prices soar

In the months following Russia's invasion of Ukraine, prices at the pump continued to reach record highs in the U.S. On March 8th, AAA reported the nation's then record-high (not accounting for inflation) of $4.17 a gallon. By mid-May, the national average was $4.58, with gas prices above $4 in every state.

Contributing: The Associated Press

Why US gas prices are at a record and why they'll stay high for a ...

SCHWEDT, GERMANY - MAY 03: In this aerial view, huge tanks for crude oil of the PCK oil refinery, which is majority owned by Russian energy company Rosneft and processes oil coming from Russia via the Druzhba pipeline, stands on May 3, 2022 in Schwedt, Germany. European Union member states are to meet later this week to possibly agree on a phased-in ban on oil imports from Russia after Germany, which relies heavily on Russian energy imports, recently said it was willing to support a ban. (Photo by Hannibal Hanschke/Getty Images)

How to save money on gas by being more fuel efficient

MILL VALLEY, CA - MARCH 03: A customer pumps gasoline into his car at an Arco gas station on March 3, 2015 in Mill Valley, California. U.S. gas prices have surged an average of 39 cents in the past 35 days as a result of the price of crude oil prices increases, scheduled seasonal refinery maintenance beginning and a labor dispute at a Tesoro refinery. It is predicted that the price of gas will continue to rise through March. (Photo by Justin Sullivan/Getty Images)

Gas prices over the $6 dollar mark are displayed at a gas station in Sacramento, Calif., Friday, May 27, 2022. (AP Photo/Rich Pedroncelli)

New York CNN Business —

Russia’s invasion of Ukraine is a major reason that US drivers are paying record prices for gasoline. But it’s not the only cause of the spike.

Numerous factors are pushing prices up, with regular gasoline hitting a record $4.87 a gallon Monday according to AAA’s survey — up 25 cents a gallon in just the last week.

Gas prices were already expected to breach the $4 a gallon mark for the first time since 2008, with or without shots fired in Eastern Europe or economic sanctions imposed on Russia. But now the national average is expected to hit $5 a gallon within the next two weeks, said Tom Kloza, global head of energy analysis for the OPIS, which tracks gas prices for AAA.

Now, because so many factors are at play simultaneously, drivers should prepare to pay uncomfortably high gas prices through at least Labor Day. Prices could easily reach $4.50 a gallon before they start to retreat, and even a $5 per gallon national average is not out of the question.

Here’s what’s behind the record price surge:

Russia’s invasion of Ukraine

Russia is one of the largest oil exporters on the planet. In December it sent nearly 8 million barrels of oil and other petroleum products to global markets, 5 million of them as crude oil.

Very little of that went to the United States. In 2021 Europe got 60% of the oil and 20% went to China. But oil is priced on global commodity markets, so the loss of Russian oil affects prices around the globe no matter where it is used.

The concerns about disrupting global markets led Western nations to initially exempt Russian oil and natural gas from the sanctions they put in place to protest the invasion.

Despite that carve out, much of Russia’s oil is going unsold on global markets. Traders are reluctant to bid for it when it’s not clear that any deal can be closed, given the sanctions on Russia’s banking system. There have also been difficulties finding any tankers able or willing to call on Russian ports.

This has resulted in a de facto ban on Russian oil in global markets, with investors pricing crude as if the country’s supply isn’t available.

But in March the United States announced a formal ban on all Russian energy imports. And last week the EU announced a ban on imports of Russian oil by ship, which represented about two-thirds of the oil European nations imported from Russia. Russia’s oil is slowly and steadily being removed from global markets.

There is growing political pressure on the rest of Europe to join a formal ban on Russian oil. Russia supplies about 27% of the 27-nation EU’s oil imports.

While oil prices moved somewhat higher on the US and UK moves, a European ban could drive global prices up further due to concerns the restriction will stay in place indefinitely, even once the fighting in Ukraine stops. Oil is generally traded as futures pegged to delivery.

The price of a barrel of Brent crude, the closely watched benchmark used in Europe, closed Monday at $123.21, up 27% since the start of fighting just 12 days ago. West Texas Intermediary oil, the US benchmark,closed at $119.40 a barrel Monday, up 30% over the same timeframe.

Less oil and gas from other sources

Oil prices plunged when pandemic-related stay-at-home orders around the world crushed demand in the spring of 2020, and crude briefly traded at negative prices. In response, OPEC and its allies, including Russia, agreed to slash production as a way to support prices. And even when demand returned sooner than expected, they kept production targets low.

US oil companies don’t adhere to those types of nationally mandated production targets. But they have been reluctant or unable to resume producing oil at pre-pandemic levels amid concerns that tougher environmental rules could cut future demand. Many of those stricter rules have been scaled back or failed to become law.

“The Biden administration is suddenly interested in more drilling, not less,” Robert McNally, president of consulting firm Rapidan Energy Group, said earlier this spring. “People are more worried about high oil prices than anything else.”

It takes time to scale up production, particularly when oil companies are facing the same supply chain and hiring challenges as thousands of other US businesses.

“They can’t find people, and can’t find equipment,” McNally added. “It’s not like they’re available at a premium price. They’re just not available.”

Oil stocks have generally lagged the broader market over the last two years, at least until the recent run-up in prices. Oil company executives would rather find ways to boost their share price than increase production.

“Oil and gas companies do not want to drill more,” Pavel Molchanov, an analyst at Raymond James, said earlier this spring. “They are under pressure from the financial community to pay more dividends, to do more share buybacks, instead of the proverbial ‘drill baby drill,’ which is the way they would have done things 10 years ago. Corporate strategy has fundamentally changed.”

Not only is oil production lagging behind pre-pandemic levels, US refining capacity is falling. Today, about 1 million fewer barrels of oil a day are available to be processed into gasoline, diesel, jet fuel and other petroleum-based products.

State and federal environmental rules are prompting some refineries to switch from oil to lower carbon renewable fuels. Some companies are closing older refineries rather than investing what it would cost to retool to keep them operating, especially with massive new refineries set to open overseas in Asia, the Middle East and Africa in 2023.

And the fact that diesel and jet fuel prices are up far more than gasoline prices shows that refiners are shifting more of their production to those products.

Strong demand for gas

But supply is only part of the equation for prices. Demand is the other key, and while it’s very strong right now, it’s still not back to pre-pandemic levels.

Job gains have remained strong so far in 2022. And as many workers who have been working from home much of the last two years return to the office, demand is getting another boost.

“Jobs numbers have been pretty impressive and a lot of [workers] will be driving to work somewhere,” said Tom Kloza, global head of energy analysis for the Oil Price Information Service. “There’s also going to be more people not working remotely than there were last year or even last month. I don’t know how to put a number on that, but that is certain to add to demand.”

The end of the Omicron surge and the removal of many Covid restrictions is encouraging people to get out of the house for more shopping, entertainment and travel.

Commuting may remain down slightly. Many who plan to return to the office will be there only three or four days a week, and the total number of jobs is still a bit below 2019 levels. But there will be periods, most likely this summer, with higher demand for gas than during comparable periods before the pandemic, Kloza predicts.

But there will be periods, most likely this summer, where there will be more demand for gas than during comparable periods before the pandemic, Kloza predicts.

Tight supplies and strong demand were likely to push prices above $4 even without the current disruption caused by the war.

“Even before Ukraine, I was expecting to break the record,” Kloza said. “Now it’s a question of how much we break the record by.”

– CNN’s Gregory Wallace contributed to this report

Gas prices jump to fresh record highs | CNN Business

World Bank president on handling 'biggest slowdown of the global economy in 80 years'

Strategist: We're at peak pessimism (and why that's a good thing)

Retirees becoming homeless at higher rate than other age groups amidst inflation

How this mom is using coupons to combat inflation

Former labor secretary on how Biden administration can combat inflation

Here's what the US economy can expect if a recession hits

He predicted US inflation would rise. Hear what he thinks about a recession

A For Sale sign is displayed in front of a house in Washington, DC, on March 14, 2022.

What the interest rate hike means for you

The Fed anticipates more rate increases after announcing biggest hike in 28 years

U.S. Federal Reserve Board Chairman Jerome Powell takes questions after the Federal Reserve raised its target interest rate by three-quarters of a percentage point to stem a disruptive surge in inflation, during a news conference following a two-day meeting of the Federal Open Market Committee (FOMC) in Washington, U.S., June 15, 2022.

CEOs at major oil companies come under fire for high gas prices

New York CNN Business —

In another blow to the US economy, prices at the pump soared to fresh record highs.

The national average price for regular gasoline climbed more than four cents on Tuesday to $4.37 a gallon, according to AAA. That takes out the prior record of $4.33 set on March 11.

The gas spike — prices are up 17 cents in the past week alone — will only add to inflationary pressures that have raised recession fears, rocked financial markets and soured Americans’ views on the economy.

The national average dipped to as low as $4.07 a gallon in April after the record-setting release of oil from emergency reserves and as oil prices cooled off. But as industry analysts predicted at the time, that relief proved to be short-lived and minor.

Pump prices are up about 25% since Russia’s invasion of Ukraine set off shockwaves in global energy markets.

Real gas prices, adjusted for inflation, would need to climb above $5.30 a gallon to break the records set in 2008, according to the US Energy Information Administration.

Still, the latest spike in gas prices will only make today’s inflation problems worse, and for the most part won’t be captured in Wednesday’s closely watched inflation report.

Some analysts fear even higher prices are coming. Andy Lipow, president of Lipow Oil Associates, told CNN on Sunday he expects retail prices will jump to $4.50 a gallon in the next week to 10 days.

Gas prices move with a lag to oil, and the good news is that oil prices fell sharply Monday, perhaps taking some pressure off pump prices.

US oil tumbled 6% to $103.09 a barrel on Monday, its worst day since late March.

Beyond concerns about China’s Covid lockdowns, analysts said oil dropped because it got swept up in the gloom-and-doom on Wall Street as stocks dropped. Crude prices were just slightly lower Tuesday morning.


Fiji says climate change, not conflict, is Asia's biggest security threat ...

(Reuters) Fiji's defense minister said on Sunday that climate change posed the biggest security threat in the Asia-Pacific region, a shift in tone at a defense summit dominated by the war in Ukraine and disputes between China and the United States.

The low-lying Pacific islands, which include Fiji, Tonga and Samoa, are some of the most vulnerable countries in the world to the extreme weather events caused by climate change.

Fiji has been battered by a series of tropical cyclones in recent years, causing devastating flooding that has displaced thousands from their homes and hobbled the island's economy.

"In our blue Pacific continent, machine guns, fighter jets, gray ships and green battalions are not our primary security concern," Inia Seruiratu, Fiji's Minister for Defense, said at the Shangri-La Dialogue , Asia's top security meeting.

"The single greatest threat to our very existence is climate change. It threatens our very hopes and dreams of prosperity."

China, Pacific islands unable to agree on security pact | CNN

(CNN) China's Foreign Minister Wang Yi on Monday urged the Pacific region not to be "too anxious" about his country's aims after a meeting in Fiji with his counterparts from 10 island nations was unable to agree to a sweeping trade and security communique.

Wang hosted the meeting with foreign ministers from Pacific island nations with diplomatic ties with China midway through a diplomatic tour of the region where Beijing's ambitions for wider security ties has caused concern among US allies

A draft communique and five-year action plan sent by China to the invited nations ahead of the meeting showed China was seeking a sweeping regional trade and security agreement

But the draft communique prompted opposition from at least one of the invited nations, Federated States of Micronesia, according to a letter leaked last week.

After the meeting, which included Samoa, Tonga, Kiribati, Papua New Guinea, Vanuatu, Solomon Islands, Niue and Vanuatu, Wang said the nations had agreed on five areas of cooperation, but further discussions were needed to shape more consensus.

The five areas he listed included economic recovery after the Covid pandemic, and new centers for agriculture and disaster, but did not include security.

"China will release its own position paper on our own positions and propositions and cooperation proposals with Pacific island countries, and going forward we will continue to have ongoing and in-depth discussions and consultations to shape more consensus on cooperation," he told reporters in Fiji. Questions at the media briefing were not allowed.

Wang said some had questioned China's motives in being so active in the Pacific islands, and his response was China supported developing countries in Africa, Asia and the Caribbean also.

"Don't be too anxious and don't be too nervous, because the common development and prosperity of China and all the other developing countries would only mean great harmony, greater justice and greater progress of the whole world," he said.

Taking questions after Wang's briefing, China's Ambassador to Fiji, Qian Bo, said participants had agreed to discuss the draft communique and the five-year plan "until we have reached an agreement."

"There has been general support from the 10 countries with which we have diplomatic relations, but of course there are some concerns on some specific issues."

Fiji's Prime Minister Frank Bainimarama told reporters the Pacific nations were prioritizing consensus.

"Geopolitical point-scoring means less than little to anyone whose community is slipping beneath the rising seas, whose job is being lost to the pandemic, or whose family is impacted by the rapid rise in the price of commodities," Bainimarama said.

In a written address to the meeting, China's leader Xi Jinping said China will always be a good friend of Pacific Island countries no matter how the international situation changes, China's state-owned CCTV reported.

Pacific tour

Several invited nations want to defer action on the draft communique or have it amended, an official from one Pacific country said earlier.

The United States, Australia, Japan and New Zealand have expressed concern about a security pact signed by the Solomon Islands with China last month, saying it had regional consequences and could lead to a Chinese military presence close to Australia.

The new Australian government has made the Pacific islands an early foreign policy priority to counter Beijing's push, sending the foreign minister to Fiji with the message Australia would put new priority on the region's biggest security challenge of climate change and announcing a new visa program to allow Pacific island citizens to migrate.

In Honiara last week, Wang condemned interference in the deal and said the Solomon Islands' relationship with China was a model for other Pacific island nations.

With borders closed across the region because of the Covid pandemic, most foreign ministers are attending the Fiji meeting by video link. In several Pacific countries, the foreign minister is also prime minister.

Wang will travel to the South Pacific kingdom of Tonga for a two-day visit on Tuesday.

Shangri-La Dialogue: China blasts US 'bully', says it will 'fight to the ...

Singapore (CNN) Chinese Defense Minister Wei Fenghe on Sunday accused the United States of being a "bully" and "hijacking" countries around the region, during a combative speech in which he said his country would "fight to the very end" to stop Taiwanese independence.

"Taiwan is first and foremost China's Taiwan," Wei told the Shangri-La Dialogue, Asia's premier defense conference, adding that China would "not hesitate" to crush any attempt by the self-governed island to "secede."

The speech -- which came just weeks after US President Joe Biden said the US would respond "militarily" if China attacked Taiwan -- capped a weekend of confrontational exchanges between the American and Chinese military chiefs.

Wei also called out US Defense Secretary Lloyd Austin, who had told the conference a day earlier that China was engaged in coercive, aggressive and dangerous actions that threatened to "undermine security, stability and prosperity in the Indo-Pacific."

Austin had also talked about US coalition-building in the region and its joint military exercises with Japan , Australia, India and Indonesia, but Wei said this was a kind of "power politics" that China rejected.

"No one and no country should impose its will on others, or bully others under the guise of multilateralism," Wei said.

"We notice Secretary Austin's remarks on the US Indo-Pacific strategy. To us, the strategy is an attempt to build an exclusive, small group in the name of a free and open Indo-Pacific, to hijack countries in our region and target one specific country. It is a strategy to create conflict," Wei said.

"Fight to the very end"

But Wei -- who met Austin in a bilateral meeting on Friday afternoon -- reserved some of his harshest criticisms for Washington's stance on Taiwan, the democratically governed island that Beijing considers its territory despite never having ruled it.

Austin had on Friday said the US would continue to support Taiwan with the means to defend itself, including arms sales which China sees as a violation of its sovereignty.

Under US policy, Washington provides Taiwan defensive weapons, but has remained intentionally ambiguous on whether it would intervene militarily in the event of a Chinese attack -- a policy that the White House insists remains intact despite Biden's recent comments that appeared to deviate from the ambiguity. Washington acknowledges China's position that Taiwan is part of China, but has never officially recognized Beijing's claim to the self-governing island.

Wei said there would be no compromise on China's sovereignty or the question of whether Taiwan will one day be "reunited" with the mainland -- a clear goal of China's ruling Communist Party , which calls for peaceful "reunification" but has not ruled out using force.

"China will definitely realize its reunification. ... It is a historical trend that no one, no force can stop," Wei said.

And the People's Liberation Army was prepared to spill blood to enforce that if necessary, he said.

"Let me make this clear," Wei said. "If anyone dares to secede Taiwan from China, we will not hesitate to fight. We will fight at all costs. And we will fight to the very end."

The Chinese defense minister said the road the US is taking in the region is one his country would never go down.

"The order of human civilization must be based on the rule of law. Otherwise, the law of the jungle will prevail," Wei said.

"China will never seek hegemony or engage in military expansion or an arms race. We do not bully others, but we will not allow others to bully us," he said.

Wei leads China's Ministry of National Defense, but is not the top military official in the Chinese Communist Party's Central Military Commission, which controls China's armed forces under Chinese leader Xi Jinping.

China's Defense Minister Wei Fenghe speaks at the Shangri-La Dialogue summit in Singapore on June 12.

Regional tensions

China has faced a barrage of criticism during the Shangri-La conference.

Delegates from US allies like Australia and Canada have been critical of what they see as Beijing's violation of international laws, including what they claim are dangerous intercepts of their aircraft operating in the region.

Without mentioning China by name, Japanese Prime Minister Fumio Kishida said Friday that the Asian security situation is prompting Tokyo to substantially increase its defense budget and consider acquiring "counterstrike weapons," of the type not now in its arsenal.

Japanese forces and Australian forces, among other US allies and partners, have been operating in the South China Sea, almost all of which China claims as its sovereign territory.

China has militarized various man-made islands in the 1.3 million square mile waterway.

But Wei inferred that it was the US that was muscling in by sending naval ships into the waterway.

"Some big power has long practiced navigation hegemony on the pretext of freedom of navigation," Wei said.

He said the US and China are at a critical juncture in their relationship, but contended the ball is in Washington's court when it comes to diffusing tensions.

Washington must stop "smearing" Beijing and "interfering in China's internal affairs" for relations to improve, Wei said.

"It will be a historic and strategic mistake to insist on taking China as a threat and of an adversary or even an enemy," he said.

If Washington can treat Beijing with "mutual respect," there is room for both nations to prosper, Wei contended.

But he had a stern warning if the United States chose otherwise.

"If you want to cooperate, we should promote mutual benefits and win-win results. However, if you want confrontation, we will fight to the end."

Why the sparsely-populated South Pacific islands have become the ...

Hong Kong (CNN) The island nations that stretch across the South Pacific -- sparsely populated atolls and volcanic archipelagos, known more for tourism than lucrative natural resources -- may not seem, at first glance, to be a major geopolitical prize.

Yet, Pacific Island countries have become the latest arena for a great power contest between the United States and China.

That contest was thrown into sharp focus in recent days, as China's Foreign Minister Wang Yi completed a 10-day tour of eight countries to promote cooperation and a sweeping, regional security and economic proposal with the potential to significantly ramp up Beijing's role in the South Pacific.

Wang's trip, and news of that proposed deal, sent the powers with longstanding relationships in the South Pacific -- Australia, New Zealand, and the United States -- scrambling, with Washington pledging last week to intensify its own support of the region and Canberra dispatching its foreign minister on a dueling diplomatic tour.

Some Pacific Island leaders pushed back on the posturing, stressing instead the importance of other issues, such as climate change, with Fiji's Prime Minister Josaia Voreqe Bainimarama noting that, "geopolitical point scoring means less than little to anyone whose community is slipping beneath the rising seas."

the rising tensions between major powers. China's bid for a larger, regional pact ultimately didn't win backing at a 10-country meeting last week, but Wang did leave behind a clear message of China's interest in the region -- and heightened concerns that these island nations, which carry a history of strategic importance, will have little choice but to navigatethe rising tensions between major powers.

Island hopping

From the vantage point of Washington and Canberra, Beijing is bolstering ties with capitals across the South Pacific, so it can potentially seek to parlay infrastructure deals, or even seemingly modest security agreements, into a military foothold.

That would drive a wedge into the two countries' military presence in the South Pacific, where the US maintains military bases and a Compact of Free Association with the Federated States of Micronesia (FSM), the Republic of the Marshall Islands (RMI), and the Republic of Palau, which gives it military operating rights over the airspace and waters of these nations.

Australia operates its own navy in the region and has long maintained defense and security ties with neighboring island governments, including on peacekeeping and military training. Both Australia and New Zealand are part of regional and bilateral security pacts in the Pacific.

The region was included in a joint statement between US President Joe Biden and New Zealand Prime Minister Jacinda Ardern last week, which voiced concern about "the establishment of a persistent military presence in the Pacific by a state that does not share our values."

And for the US and Australia threats to the regional status quo have echos of World War II, when the islands were used by imperial Japan to threaten Australia, before becoming part of an American "island hopping" offensive that ultimately played into the turning tide in the Pacific.

"The islands sit astride a key passageway for US and Australian naval ships and merchant ships," said Timothy Heath, a senior international defense researcher at the RAND Corporation in Arlington.

"If China could establish (military) basing rights, it could deploy warships and aircraft temporarily to the islands. (Its) ships and airplanes could threaten US and Australian ships and aircraft that passed by," he said, adding that even a boosted presence, short of a military one, could help China "collect sensitive intelligence on US and Australian military operations."

Winning friends

China's interest in building rapport with the Pacific Islands countries is not new. In the early 2000s, as the US was turning its attention toward perceived threats in the Middle East, a newly outward-looking China was starting on a path to become an economic and diplomatic partner for Pacific island countries -- not least of all as it sought to win friends away from Taiwan, which is now only formally recognized by four of 14 South Pacific nations, after the Solomon Islands and Kiribati switched allegiance to China in 2019.

In recent years, as Beijing has pursued a more assertive foreign policy and expanded development funding globally in a bid to enhance its international sway, its visibility in the Pacific Islands, too, has grown. China has backed widely publicized projects in some Pacific Island countries -- a national sports stadium to host the Pacific Games in the Solomon Islands, highways in Papua New Guinea, bridges in Fiji -- and sent high-level envoys to the region, including two visits from Chinese leader Xi Jinping, once in 2014 and again in 2018. It's also become a major trading partner for Pacific Island economies.

China's ambassador to the Solomon Islands Li Ming and Solomons Prime Pinister Manasseh Sogavare at the opening ceremony of a China-funded national stadium complex in Honiara on April 22, 2022.

And while Australia has remained the top aid donor in the region for the past five years, according to data collected by the Australian think tank Lowy Institute, experts say that in some parts, perceptions are that China is a more expedient partner than traditional donors.

"There is an assumption that China will do more," said Celsus Talifilu, a political adviser based in Solomon Island's Malaita Province, who has been an outspoken critic of how the national government has handled its recent relations with China.

"It may be that our politicians are thinking that it's easier to deal with China in terms of implementing things on the ground quickly, in comparison to other donors that have been in the Solomons for a long time yet have been very slow," he told CNN.

Containment concerns

Concerns that Beijing may have military ambitions in the region were fueled in April after China and the Solomon Islands signed a security agreement , sparking fears of creating an opening for China to establish a military presence in the country.

Wang, the foreign minister, has been quick to deny China's latest moves have had a military angle, saying flatly of the Solomons deal that Beijing did not intend to build military bases and calling on observers "not to be too anxious" about China's overall aims in the region, where he said it has "no intention of scrambling for influence."

"China and developing countries realizing common development and prosperity will make the world fairer, more harmonious and stable," Wang said, following a meeting with Pacific Island leaders last week.

Many observers say Beijing may be a long way from a military foothold, but agree that expanding its presence overseas would be a logical next step for an ambitious power like China.

"As China grows it is little wonder that the Chinese security interest in the (South Pacific) region will also grow," said Denghua Zhang, a research fellow at The Australia National University's Coral Bell School of Asia Pacific Affairs in Canberra.

One driver may be concerns, often discussed by Chinese scholars and strategists, of China being enclosed by the US and its allies. This has bolstered the concept of breaking the "island chains" viewed as hemming China in, in particular, with military bases on islands near China and in the Pacific, according to Zhang. These include US military bases in Japan and Guam, and a military presence in the Philippines.

In an analysis the US Indo-Pacific strategy published last year, Shanghai Academy of Social Sciences senior researcher Liu Ming and co-authors expressed this concern, writing: "The [American] principle of containment is to politically isolate China throughout the region by expanding a network of allies and partners, so as to draw more "Indo-Pacific" countries into the US camp."

Blue Pacific

China's growing outreach has left other powers on the back foot -- scrambling to energize their presence, from Australia's "Step-Up" policy and New Zealand's "Pacific Reset," both in 2018, to Washington's "Pacific Pledge" a year later.

"They've all developed these new initiatives for the Pacific ... essentially amounting to the same thing, wanting to ensure that they remain the partners of choice and China is not gaining the upper hand," said Sandra Tarte, an associate professor in the University of the South Pacific's School of Law and Social Sciences in Fiji.

To some extent, there is an upshot for the Pacific Island countries: as these powers try and outdo the other, this can bring more focus to and leverage for local governments.

"The Pacific Island people ... are not new to global, geopolitical competition," said Tarcisius Kabutaulaka, associate professor of Pacific Islands Studies at the University of Hawaiʻi at Mānoa.

Vanuatu's Prime Minister Bob Loughman Weibur and visiting Chinese Foreign Minister Wang Yi pose with officials following a signing ceremony for agreements between the two countries in the capital city Port Vila on June 1, 2022.

He points back to the 1800s when the islands were the focus of colonial competition through to the Cold War, where there was pressure for nascent Pacific Island countries to shun Soviet advances. But as time goes on -- and if US-China tensions continue to rise -- the balancing act may become more difficult, Kabutaulaka said.

That may have been one factor in why the sweeping pact conceived of by Beijing did not ultimately come to pass last week. Another may be the region's "Blue Pacific" concept, which emphasizes collective decision-making about the region through consultation with all members.

"Our position was that you cannot have regional agreement when the region hasn't met to discuss it," Samoa's Prime Minister Fiame Naomi Mata'afa said Thursday.

Wang did sign a number of bilateral deals including on areas of economic cooperation, disaster management and policing equipment. But even without a deal -- this time -- competition and varying views on engaging with China could chip away at cohesion in the region, said Kabutaulaka.

"I'm concerned that geopolitical competition will ... affect the strong regional bond."

While China makes Pacific islands tour, US Coast Guard is already ...

(CNN) As China's foreign minister began a Pacific islands tour to promote economic and security cooperation with Beijing, the smallest of the US government's armed services was already on the scene, reinforcing Washington's longstanding commitment to the region.

Reacting to a request from the Solomon Islands, the first stop in Chinese Foreign Minister Wang Yi's 10-day regional diplomatic tour, the US Coast Guard diverted its cutter Myrtle Hazard to patrol the island nation's exclusive economic zone after a Solomons police vessel needed repairs.

The US cutter "helped to fill the operational presence needed by conducting maritime surveillance to deter illegal, unreported, and unregulated fishing in the northern Solomon Islands," a Coast Guard press release said.

Crewmembers aboard the US Coast Guard Cutter Myrtle Hazard stand watch on the bridge while underway in Oceania.

The Myrtle Hazard was already in the region as part of Operation Blue Pacific, what the Coast Guard calls its "overarching multi-mission ... endeavor promoting security, safety, sovereignty, and economic prosperity in Oceania while strengthening relationships."

The Solomon Islands is just one of several Pacific island nations the US aids under Operation Blue Pacific, including, among others, Kiribati, Samoa, Fiji, Tonga and Papua New Guinea -- all stops on the Chinese foreign minister's tour.

China had proposed a sweeping regional security and economic agreement with a number of Pacific Island nations, according to documents seen by CNN. The deal, which touched on a range of areas including education and health, was targeted for a Monday meeting between Wang and foreign ministers from 10 Pacific island nations in Fiji.

The meeting ended without the signing of the proposed agreement, with Wang instead noting the grouping had landed on five "points of consensus." Those areas, largely general statements such as deepening strategic partnership and pursuing common development, did not include security.

The pact, if accepted, would have marked a significant advance in Beijing's connection to the region, which holds geo-strategic importance in the Indo-Pacific.

Wang Yi defended China's intentions during the media briefing in Fiji on Monday, referencing "questions" about why China was "actively supporting" Pacific Island countries.

"Don't be too anxious and don't be too nervous, because the common development and prosperity of China and all the other developing countries would only mean great harmony, greater justice and greater progress of the whole world," he said.

Coast Guard a part of Indo-Pacific strategy

Amid the Chinese push, the US Coast Guard's efforts in the region haven't received much attention. But they are substantial, and part of the Biden administration's Indo-Pacific strategy released in February.

"We will expand US Coast Guard presence and cooperation in Southeast and South Asia and the Pacific Islands, with a focus on advising, training, deployment, and capacity-building," the strategy's action plan says.

The Coast Guard's website shows cutters have spent hundreds of days and steamed thousands of miles in the past two years helping Pacific island nations.

The crews of the Coast Guard Cutters Juniper and Joseph Gerczak return to Honolulu after completing a 42-day patrol in Oceania on March 7, 2022.

One of the key parts of Washington's influence in the region is through "shiprider agreements" with 11 Pacific nations, including Cook Islands, Fiji, Kiribati, Marshall Islands, Micronesia, Palau, Nauru, Samoa, Tonga, Tuvalu and Vanuatu, according to US Coast Guard publications. Under these agreements, defense and law enforcement personnel from the partner nations embark aboard the US cutters to enforce their nation's laws in the island nations' exclusive economic zones.

The relationships the US Coast Guard has forged in the Pacific islands have deep roots, said Collin Koh, research fellow at the S. Rajaratnam School of International Studies in Singapore.

That "institutionalized network of defense and security relationships" is something Beijing would have a hard time duplicating, Koh said.

"It doesn't enjoy the extent of partnership networks that its geopolitical rivals, the US included, have cultivated in the region for decades," Koh said.

With fish as the main food source and key economic driver of the island nations, the Coast Guard says the emphasis of Operation Blue Pacific is to deter illegal and unregulated fishing.

And that has a big link to China.

With the world's largest fishing fleet, "Chinese-flagged fishing vessels range the world over in search of catch and are notorious for fishing within other nations' -- especially developing nations' -- exclusive economic zones (EEZs)," according to a 2021 report from the Brookings Institution.

Koh said the scope of Chinese fishing activities doesn't help Beijing's case for being a positive force in the region.

"Chinese fishing vessels are not necessarily viewed in a benign manner -- they are large distant water fishing fleets, equipped with large and better-equipped vessels that can outrun, outmuscle and outfish local fishing boats," he said.

US Coast Guard the "near-perfect" tool

Carl Schuster, a retired US Navy captain and a former director of operations at the US Pacific Command's Joint Intelligence Center, said the Coast Guard is "near perfect ... for relations building with Pacific Island countries."

Coast Guard cutters are not threatening vessels, associated with rescuing people as much as anything else, Schuster said.

"You cannot understate the Coast Guard's importance to ... relationships in the Central and Western Pacific," he said.

While some observers note that China also has a well-equipped coast guard that could do what the US is doing in the region, Koh doesn't see that happening, at least in the near term.

He notes Beijing's troubles in waters closer to home, in places like the South and East China seas, where disputes over fishing rights and territorial claims keep the Chinese coast guard busy.

Those also bring in China's credibility as a fair broker into question, he said, leaving an advantage to the US Coast Guard.

"It's difficult to imagine China having sufficient political capital to push for something analogous to what the US is currently doing," Koh said.

This story has been updated with additional reporting.

5 things to know for June 13: Gun laws, January 6, Covid, White ...

If your day doesn't start until you're up to speed on the latest headlines, then let us introduce you to your new favorite morning fix. Sign up here for the '5 Things' newsletter.

(CNN) Just imagine what a relief it would be if you could use the same charging cable for all of your devices -- your phone, laptop, earbuds, camera, tablet, portable speaker, etc. Well, in a huge step to reduce cable clutter and waste, European regulators say that Apple and other smartphone makers will be required to support a single common charging standard for all mobile devices as early as the fall of 2024. But Apple hates the idea (shocker) because that means about a billion devices will become obsolete.

Here's what you need to know to Get Up to Speed and On with Your Day.

(You can get "5 Things You Need to Know Today" delivered to your inbox daily. Sign up here .)

1. Gun laws

A bipartisan group of senators announced an agreement on gun safety legislation Sunday in the wake of several deadly mass shootings . The proposal includes "needed mental health resources, improves school safety and support for students, and helps ensure dangerous criminals and those who are adjudicated as mentally ill can't purchase weapons," the group said in a statement. Notably, the plan has the support of 10 Republican senators, which would help overcome a Senate filibuster . But many of the details of the plan are still to be sorted out and maintaining support for it throughout the legislative process will be challenging. A few major reforms were left out of the proposed deal, including a provision to expand background checks. Also absent is a ban on military-style assault weapons. Plus, there will be no change to the minimum age to purchase guns, which is 18 years old.

2. January 6

3. Coronavirus

4. White nationalists

Police in Idaho arrested 31 men believed to be affiliated with the White nationalist group Patriot Front who allegedly had plans to riot at a local Pride event Saturday in Coeur d'Alene, officials said. Authorities received a call from a concerned citizen to report that the group was meeting in the parking lot of a hotel and "looked like a little army" equipped with shields and masks, the city's Police Chief Lee White said. They intended to riot at an event that included a Pride walk and performances by local musicians, dancers and drag artists, police said. All 31 men were charged with conspiracy to riot, which is a misdemeanor.

5. Stocks

Global markets and US stock futures fell early today , indicating a downbeat start to the trading week after a broad sell-off on Wall Street. The Dow plunged 880 points, or 2.5%, on Friday. The S&P 500 shed 2.7% and the Nasdaq dropped about 3%. The Consumer Price Index rose by 8.6% in May, raising fears that the Federal Reserve will have to act even more aggressively to try to tame inflation. The shockwaves were felt most acutely in Asia today. Japan's Nikkei closed down 3%, and the yen weakened to the lowest level in more than 20 years. If you're looking for ways to protect yourself financially while also making the most of what you have, CNN has developed this list of options to consider.

BREAKFAST BROWSE

'Squid Game' season 2 is coming to Netflix

Green light! The wildly popular series is making a highly anticipated return

Tony Awards

Broadway's best were recognized Sunday night at New York's Radio City Music Hall. View the full list of winners here

Country music superstar Toby Keith announces he's been fighting stomach cancer

Keith said he plans to return to the stage after taking time to rest and recover.

Rebranded McDonald's restaurants are unveiled in Russia

Due to the war in Ukraine, McDonald's removed all of their golden arches from Russia. This is what the restaurants look like now

Woman sets record swimming 26.22 miles in a mermaid fin

Swimmer Merle Liivand encountered loads of marine life on her impressive journey -- and was even stung by a jellyfish.

TODAY'S NUMBER

$5

That's how much a gallon of regular gas now costs on average nationwide, according to data from AAA today. While a $5 national average set a new record this past weekend, $5 gas has become unpleasantly common in much of the US. Friday's readings showed more than 30% of stations nationwide were already charging more than $5 a gallon. And about 10% of stations are currently charging more than $5.75 a gallon.

TODAY'S QUOTE

"In our blue Pacific continent, machine guns, fighter jets, gray ships and green battalions are not our primary security concern. The single greatest threat to our very existence is climate change."

-- Inia Seruiratu, Fiji's minister for defense, saying that climate change posed the biggest security threat in the Asia-Pacific region. Fiji has been battered by a series of tropical cyclones in recent years that caused devastating flooding that displaced thousands from their homes and hobbled the island's economy.

TODAY'S WEATHER

JUST WATCHED Record heat spreads to the East Replay More Videos ... MUST WATCH Record heat spreads to the East 02:21

AND FINALLY

How Tea Time Came to England