Gas Prices in 2004

The 2004 average was $1.85, 29.1¢ above 2003 and 15.6% higher after inflation. It was the first year in which the weekly national average passed $2.00: it reached $2.06 in the week of May 24, the year’s high. The largest weekly increase, 9.7¢, came two weeks earlier.

The cause was mainly crude oil. Global oil demand grew strongly in 2004, and crude prices rose through most of the year; the New York Harbor wholesale gasoline price averaged $1.18 a gallon, up from 88¢ in 2003. Unlike 2003, the rise was broad rather than a single spike. After the May high, pump prices dipped over the summer and rose again in the fall, when the monthly average returned to $2.00 in October. The year’s low was its first week, $1.51 on January 5, and it ended at $1.79, about 28¢ higher than it began. In inflation-adjusted terms, 2004 was the most expensive year since 1985 in the site’s long annual record.

The cheapest week of 2004 came on January 5, 2004, at $1.51. That floor was higher than the full-year averages of 2000 ($1.48), 2001 ($1.42) and 2002 ($1.35), a measure of how far the whole price level had moved in a short time. Compared with 2000, the annual average rose 24.8% in current dollars and 13.8% after inflation. The climb went on for years afterward: the 2014 average, $3.36, stood 81.3% above 2004’s in current dollars.

In the 1970–2025 ranking of complete years, 2004 sits at 22nd by current-dollar price and 31st after adjusting to 2025 dollars. On that inflation-adjusted basis its $3.16 is below 2024’s $3.39, so a gallon at the 2004 average cost less in real terms than one bought twenty years later.

EIA’s all-grades state estimates for 2004 put Georgia ($1.65) and Oklahoma ($1.68) at the bottom; Georgia had been the cheapest state every year since 1987. Hawaii was highest at $2.13, 31.2¢ above the all-grades U.S. average of $1.82, followed by Nevada at $2.06 and California at $2.02.

At the pump, the national average moved from $1.56 in 2003 to $1.85 in 2004, an increase of 18.6%. The following year carried it to $2.27 in 2005, a rise of 22.6% from 2004. In constant 2025 dollars, the increase from 2004 to 2005 was 18.6%.

Ten years before, the 1994 average was $1.12 at the pump. Between 1994 and 2004 the inflation-adjusted average rose 30.2%, and that span includes the 2000 change of basis. From 2000 the national figure is the mean of EIA's weekly U.S. regular-grade retail prices, which is the method behind the 2004 figure. Among the 56 complete years from 1970 to 2025, 2004 ranks 26th-lowest in constant 2025 dollars, while the highest inflation-adjusted annual average, $5.08, belongs to 2012.

Across the 52 weeks of EIA data in 2004, the highest and lowest weekly prices differed by 55.4¢. State averages for 2004 ran from Georgia at $1.65 to Hawaii at $2.13, a gap of 48.1¢ on the all-grades basis. Above the U.S. all-grades average in 2004 were 26 of 51 states, including D.C.