Gas Prices Differ By Region

Prices have surged above $4 a gallon in California and have also climbed in nearby Washington, Oregon and Nevada, though not as drastically.

Areej Aljalabi, a 45-year-old stay-at-home mom who lives in San Diego, said she paid $5 a gallon for gasoline earlier this month and has been trying to limit her driving. That compares with a state average this year of $3.63 and the U.S. average of $2.60, according to GasBuddy. “I couldn’t believe it,” she said. “It’s affecting me in so many ways.” Economists are focusing on the cost of gasoline and other core expenses because consumer spending accounts for more than two-thirds of U.S. growth and has helped cushion the world’s largest economy from a slowdown overseas. Data last week showed that U.S. retail sales dropped unexpectedly in September, a potential warning sign that a key pillar of support for the economy is weakening. Moves in gasoline prices could also affect expectations for inflation and interest-rate policy. The Federal Reserve is likely next week to lower rates for the third time this year, but central-bank officials are divided on whether further reductions will be necessary in the months ahead. Economists said the gasprice spikes will likely slow economic activity in affected regions, but that the continued low level of national prices augur continued U.S. expansion.