Gasoline prices in the U.S. are climbing again after a brief period of relief. On Monday, the national average reached $4 per gallon, according to AAA. This rise follows the resurgence of conflict with Iran, which has disrupted shipping and strained global refineries.
Gas prices increased by 13 cents compared to the previous week when the average was $3.87. This marks a return to the high prices observed earlier this year in March, following U.S. and Israeli attacks on Iran. During that period, prices hit an average of $4 per gallon for the first time since the 2022 Russian invasion of Ukraine. They later exceeded $4.50 in May before easing below $4 after a temporary U.S.-Iran ceasefire agreement.
The ceasefire was short-lived as the conflict escalates again. The U.S. has reinstated a naval blockade on Iranian ports in the Strait of Hormuz, a critical route for oil and gas. This blockade, combined with strikes in the area, has substantially halted shipping, driving energy prices higher.
Brent crude, the global oil benchmark, surpassed $90 per barrel on Monday, marking its highest in over a month. Meanwhile, West Texas Intermediate, the U.S. benchmark, reached $82 per barrel.
Diesel prices have also soared, rising above $5 per gallon, a 33% increase since the conflict began. On Monday, diesel cost $5.11 per gallon, up by 23 cents from the previous week.
National average prices do not capture the variation across regions. In many Southern states, prices hover around $3.60 per gallon, contrasting with California, where they reach $5.50 per gallon.
The rising prices pose a challenge for President Trump as November’s midterm elections approach. Economic concern is a leading issue for voters. Last week, the White House praised economic data showing a dip in consumer prices in June, although they were still 3.5% higher than the previous year. President Trump stated, “Prices are coming way down, and we’re doing a great job. And remember that for the midterms.”
However, July tells a different story. Several factors, beyond the increased oil costs from the Middle East conflict, contribute to price pressures. U.S. refineries converting oil into various fuels are operating at high capacities with low inventory. Additionally, summer travel has pushed gas demand higher.
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