The previous highest year was 1981, when gasoline prices averaged $3.45 in inflation adjusted or constant dollar terms, according to EIA data.
The 2011 gasoline prices were about 66 cents per gallon higher than during 2010. If a family uses 500 gallons per year, the additional cost was $330 and $660 dollars for families using 1,000 gallons per year. Just the increase in gasoline prices between 2010 and 2011 represents about 1% to 4% of after tax income for families with incomes up to the median income level of approximately $49,000.
Record high gasoline prices is one reason that demand for gasoline was down 5% in December 2011 compared to December 2010. They are a compelling reason for the nation to be moving forward with policies to accelerate the deployment of lower fuel cost natural gas vehicles and electricity vehicles as well as biofuels.