Gas prices surpass $4 per gallon for the first time since 2022 amid Iran conflict

(SeaPRwire) –   On Tuesday, U.S. gasoline prices climbed above a $4-per-gallon average for the first time since 2022, driven by a global surge in fuel costs resulting from the war with Iran.

Data from the motor club AAA indicates the national average for regular gasoline has reached $4.02, marking an increase of more than a dollar since the conflict commenced. This level of pricing at the pump has not been seen since the period following Russia’s invasion of Ukraine nearly four years ago.

Because this figure represents a national average, many motorists in various states have already been paying well over $4 per gallon, with costs fluctuating based on local supply levels and state-specific tax policies.

Since the U.S. and Israel initiated a joint military campaign against Iran on February 28, the price of crude oil—the primary component of gasoline—has experienced rapid volatility and sharp increases. This instability stems from significant supply chain interruptions and production cuts by major Middle Eastern oil suppliers.

Global motorists are also facing the impact of the war on fuel costs. For instance, in Paris, gasoline is currently priced at 2.34 euros per liter ($2.68), which equates to approximately $10.27 per gallon.

Expensive gas could drag on the economy and drive up other prices

Rising fuel costs are placing pressure on both businesses and consumers already struggling with broader cost-of-living challenges. As households spend more on fuel, they may be forced to reduce expenditures in other areas.

Furthermore, higher fuel costs can lead to inflationary pressure on other expenses, ranging from daily consumer goods to utility bills.

The cost of living and consumer prices have become central issues in this midterm election year, with Democrats targeting Trump and the GOP as Republicans work to maintain their congressional majorities. A recent AP-NORC poll indicates that 45% of U.S. adults are “very” or “extremely” worried about their ability to afford gasoline in the coming months, an increase from 30% shortly after Trump’s 2024 election victory, which was built on promises to reduce costs.

Analysts suggest that grocery prices may be the next to rise, as businesses pass on the increased costs of transportation.

The logistics and shipping sectors are also feeling the impact. For example, the United Postal Service is requesting an 8% temporary surcharge on several of its services, including Priority Mail.

According to AAA, the average price for diesel—the fuel used by most delivery and freight trucks—has risen to $5.45 per gallon, up from approximately $3.76 per gallon before the war began.

Should the conflict continue, prices could climb further. Most tanker traffic through the Strait of Hormuz, a vital route for roughly one-fifth of global oil, remains suspended. This has prevented major regional producers from bringing crude to market, while strikes by the U.S., Israel, and Iran on oil and gas infrastructure have further exacerbated supply concerns.

Reserves open in an effort to cut prices

In an attempt to provide relief, the International Energy Agency has committed to releasing 400 million barrels of oil from the emergency reserves of member nations. This includes the United States, despite initial skepticism from Trump regarding the necessity of tapping into reserve oil.

The Trump administration has also relaxed sanctions to allow for increased oil flow from Venezuela and, temporarily, Russia. Additionally, the White House announced a 60-day waiver of the Jones Act, a century-old law governing maritime shipping requirements.

It remains uncertain whether these measures will effectively lower consumer costs, as gas prices are influenced by a variety of factors.

Because refineries typically purchase crude oil in advance, they may continue to process more expensive inventory for some time, and it will take a while for new supplies to reach the consumer market.

While high crude costs are the primary driver of the current surge, U.S. gas prices also tend to rise seasonally. Increased demand from more drivers on the road, combined with the transition to more expensive summer-blend fuel as the weather warms, contributes to the upward pressure.

The US is an oil exporter, but it’s still affected by global prices

Although the U.S. is a net exporter of oil, it has not experienced the same level of shock as regions more dependent on Middle Eastern fuel imports, such as Asia. Nevertheless, the U.S. is not insulated from price spikes.

Oil is a globally traded commodity. Furthermore, while the U.S. primarily produces light, sweet crude, many refineries on the East and West coasts are configured to process heavier, sour crude, necessitating continued imports.

Geopolitical tensions have historically disrupted oil supplies and triggered gas price surges. The U.S. national average for regular gasoline reached a record high of over $5 per gallon in June 2022, roughly four months after the start of the war in Ukraine and the subsequent imposition of sanctions on Russia, a major oil producer.

Pump prices eventually declined from that peak. According to AAA data, the national average had remained below the $4 threshold since mid-August 2022 prior to Tuesday’s increase.

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Associated Press journalists Angela Charlton in Paris and Bill Barrow in Washington contributed to this report.