Getting runaway prices in America under control is “my top priority” Joe Biden told Congress on Tuesday in his first State of the Union address.

Soaring inflation – now at a 40-year high – has hurt Biden in the polls and the US president bluntly acknowledged “too many families are struggling to keep up with the bills. Inflation is robbing them of the gains they might otherwise feel”.

The US has added 6.6m jobs since Biden took office and the unemployment rate has dropped to 4%, down from a pandemic high of 14.8% in April 2020. But soaring inflation has overshadowed his economic successes, rising at an annual rate of 7.5% over the year through January.

Biden said he would cut energy costs, the price of prescription drugs, and childcare in the US while ​​increasing competition between companies and making sure “corporations and the wealthiest Americans start paying their fair share”.

“Economists call it ‘increasing the productive capacity of our economy’. I call it building a better America,” said Biden.

Biden’s plans face heavy headwinds. On Tuesday, oil prices spiked again, passing $100 a barrel again as the war in Ukraine escalated. The rise will further increase costs for US consumers who are already paying high prices at the pump due to Covid 19-related issues. The average gallon of gas in the US was $3.61 as of 1 March, compared with $2.72 a gallon one year ago.

Many of Biden’s initiatives will also struggle to pass in a deeply divided Washington as the US heads into midterm elections this November, with polling suggesting Republicans could take control of Congress.