American drivers paid $4.46 per gallon for regular unleaded gas on Monday — the highest national average since 2022 — as oil futures surged on renewed fighting in the Strait of Hormuz and the United Arab Emirates came under Iranian missile attack. The price is up 49 percent since late February, when the US-Iran war began, and economists warn the pump price could breach $5 per gallon if the waterway remains locked in combat.
Why Are Gas Prices Surging So Fast?
The math is stark: before the war began on February 28, the national average for regular gas was $2.98 per gallon. In ten weeks, that figure has risen by $1.48 — a jump driven almost entirely by disruption to the Strait of Hormuz, through which roughly 20 percent of the world’s daily oil supply normally flows. The International Energy Agency has called it the “largest supply disruption in the history of the global oil market,” and every week the strait stays contested, refiners face tighter crude supply and higher costs that get passed directly to the pump.
Oil prices are now trading around $116–120 per barrel for Brent crude, up from roughly $72 per barrel before the war started. Each $10 increase in crude oil typically adds about 23–25 cents to gas prices, with a 4–6 week lag as crude works through the refinery pipeline. Monday’s combat — in which the US Navy sank seven Iranian boats while Iran fired missiles at UAE targets — pushed prices higher again after three days of modest declines, resetting the clock on any relief at the pump.
“We’re looking at a sustained shock, not a temporary spike. The Hormuz chokepoint handles 17 to 21 million barrels per day. Every week it’s blocked or contested adds $3 to $5 to the pump price over the following month. Americans are already paying the war premium, and it’s compounding.”
— Patrick De Haan, Head of Petroleum Analysis, GasBuddy
In California, some counties are already seeing prices above $7 per gallon for premium fuel, a figure that would have seemed implausible as recently as January. Even in states with the lowest gas prices — Texas, Mississippi, Louisiana — the average has crossed $4.00. For the roughly 90 percent of American adults who drive regularly, the war’s energy bill amounts to about $1 billion more per day in fuel costs compared to pre-war levels, according to AAA.
What Could Push Prices to $5 Per Gallon?
Analysts identify several triggers that could accelerate the price trajectory: Iranian strikes on Saudi oil infrastructure, a significant escalation that draws US air power into strikes on Iranian mainland energy sites, or evidence that Iran has successfully mined the deeper navigable channels of the strait. Any of these events would push Brent crude past $130 per barrel, which translates to roughly $5.20–$5.50 at the pump nationally within six to eight weeks.
The Federal Reserve, which held interest rates steady at 3.5–3.75 percent last Wednesday, has specifically flagged fuel prices as the primary inflation risk from the war. New York Fed President John Williams warned Monday of “significant and unpredictable risks to the economic outlook” driven by energy costs — language that signals the Fed has effectively shelved any plans for rate cuts until the situation stabilizes. Higher rates keep borrowing costs elevated for mortgages, car loans, and everything in between, adding financial pressure on households already squeezed at the pump.
Are There Any Signs of Relief?
Two scenarios could bring meaningful relief: a ceasefire that reopens the strait to unrestricted commercial traffic, or a significant expansion of US domestic energy production. President Trump has pressed Saudi Arabia to pump more oil, and the US Strategic Petroleum Reserve still has capacity to release barrels into the market. But economists caution that SPR releases typically suppress prices by only 10–15 cents per gallon for six to eight weeks — they buy time, not solutions. The fastest path to pump relief remains diplomacy in the Strait of Hormuz.
The Spirit Airlines collapse was partly driven by fuel cost pressures even before the war, and the current energy shock is putting similar pressure on smaller carriers and trucking companies. The cooling labor market reported last week already shows consumers pulling back on spending — a trend that accelerates with every additional cent added at the pump.
What This Means For You
If you drive a standard sedan averaging 30 miles per gallon and commute 15,000 miles per year, the current gas price adds roughly $740 more per year to your fuel bill compared to pre-war levels. At $5 per gallon, that figure rises to nearly $1,500 extra annually. The smartest steps you can take right now: consolidate trips, use GasBuddy to find the cheapest local stations, and if you’re considering a car purchase, factor in the realistic possibility that prices could remain elevated well into 2027 depending on how the conflict resolves.
Sources
- NBC News — Gas prices rise to $4.46 per gallon
- NPR — Gas prices went up more than 30 cents a gallon last week
- CBS News — In 8 weeks, the Iran war has dented the US economy
