The average price of gasoline in the U.S. hit $4 a gallon for the first time Sunday, the latest milestone in a run-up in fuel prices that is sapping consumer confidence and threatening to nudge the nation into recession.<\/p>\n
The record nationwide average for regular-gasoline prices, announced by auto club AAA, follows Friday’s near-$11 surge in oil prices to a record $138.54 a barrel. Both are part of what, by some measures, is the worst energy-price shock Americans have faced for a generation, in terms of its toll on their pocketbooks.<\/p>\n
In recent days, soaring fuel prices and disappointing employment data have reignited fears that the nation’s economy — which has taken a pounding over the past year from a housing downturn, credit crunch and weakening job market — will slip into recession, or pull back further if a recession is already under way. Rising fuel prices are straining household budgets, damping the spending that drives more than two-thirds of the nation’s economic activity.<\/p>\n
“What we’re seeing here is a lot of additional pressure on a consumer sector that was soft to begin with,” said Alliance Bernstein economist Joseph Carson. “Is it a tipping point by itself? It’s close.”<\/p>\n