The national average price of a gallon of regular gasoline stayed above $4 every single day in August, the first time that has happened, making it the most expensive August at the pump on record. The finding comes from AAA‘s weekly national fuel-price tracking, which shows the previous record for the month, $3.97 a gallon, was set in 2022. For retirees who still drive to appointments, errands and family visits, a fixed cost like gasoline that will not come back down eats directly into a budget that does not adjust month to month.
August Set a New Record for the Month
AAA’s tracking shows the national average held above the $4 threshold on every day of August, surpassing the prior monthly high set three years earlier. As of September 3, the national average stood at $4.1436 a gallon, essentially unchanged from a month earlier and still well above the $3.21 average recorded the same week a year ago, a year-over-year jump of roughly 29%.
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What’s Keeping Prices Elevated
AAA points to continued volatility tied to the Strait of Hormuz as a key factor keeping crude oil prices elevated, with West Texas Intermediate crude trading in the $80-a-barrel range even as U.S. crude inventories sit close to their five-year average. On the demand side, gasoline consumption climbed last week to 9.04 million barrels a day even as total domestic gasoline supply slipped from 209.4 million barrels to 206.8 million, a combination that has kept upward pressure on pump prices rather than allowing them to ease as the peak summer driving season winds down. Gasoline production itself actually increased slightly last week, averaging 9.8 million barrels a day, but not by enough to offset the drawdown in overall supply.
The run-up is not confined to gasoline. Diesel prices, which affect the cost of shipping groceries, medical supplies and other goods retirees rely on, have also hit record August highs this year, averaging around $5.40 a gallon nationally. Because higher diesel costs eventually show up in the shelf price of everything trucked to a local grocery store or pharmacy, the pressure at the pump tends to ripple into other parts of a household budget well beyond what is spent filling a car.
A Wide Gap Between the Cheapest and Priciest States
Where a retiree lives makes a real difference in how hard the record is felt. California, at $5.63 a gallon, and Hawaii, at $5.41, currently have the nation’s most expensive gasoline, followed by Washington, Alaska and Nevada, all above $4.80 a gallon. On the other end, Indiana, Texas and Mississippi have the cheapest gas in the country, each under $3.70 a gallon. That spread of nearly $2 a gallon between the priciest and cheapest states means the same driving habits can cost a retired couple hundreds of dollars more a year depending on which side of a state line they live on, a gap that matters more for someone on a fixed monthly income than for a working household still receiving regular raises.
Why a Record August Matters for a Fixed Budget
Unlike a Social Security check, which is adjusted once a year through the cost-of-living formula, gas prices move week to week and do not wait for a benefit increase to catch up. A retiree who fills a tank twice a month at today’s national average is spending noticeably more than a year ago for the same amount of driving, with no matching increase in income until the next COLA takes effect. For anyone on a strict monthly budget, that gap between a fixed check and a rising cost at the pump is exactly the kind of squeeze that shows up first in a smaller grocery bill or a skipped trip, not in a bank statement.
The year-over-year comparison illustrates how far prices have moved since last summer. A year ago, the national average sat at $3.2081 a gallon; today it is more than 90 cents higher for the identical grade of fuel at the identical time of year. For a household that drives 1,000 miles a month in a vehicle averaging 25 miles to the gallon, that difference alone adds up to roughly $37 a month, or close to $450 over a year, money that has to come from somewhere else in a fixed monthly budget when it is not offset by a corresponding rise in income.
Electricity Costs for EV Owners Held Steady
For retirees who drive an electric vehicle rather than a gas-powered car, the picture looked different in August. The national average cost of charging at a public station held steady week over week at 42 cents per kilowatt hour, according to AAA, with the least expensive states for public charging, including Kansas, Missouri and Iowa, running well below 35 cents. That gap between a stable electricity cost and a record-setting gasoline price is a reminder that the pain of this particular record is not evenly distributed across every retired driver, only those who still fill up at the pump.
This article was produced with the assistance of AI and reviewed by The Financial Wire editorial team.
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David M. Keller is a finance writer based in Columbus, Ohio, covering personal finance and consumer-focused economic topics. He earned his degree in journalism from Ohio University and began his career reporting on local business and economic trends for a regional media outlet. Since then, he has contributed to a variety of online publications, focusing on clear, practical coverage of topics such as cost of living, debt, and everyday financial decision-making.
