A Citgo gas station stands in Boston, Massachusetts, USA on January 6, 2026.
brian snyder reuter
Motorists are watching gasoline prices hit the highest in more than a year and a half as the war between the United States and Iran disrupts global oil trade.
The average price of a gallon of unleaded gasoline in the U.S. rose to about $3.54 a gallon on Tuesday, according to AAA. This is the highest level since mid-2024 and represents a 21% increase from the previous month.
Gasoline prices began to soar last week after the U.S. and Israeli attacks on Iran and the ensuing conflict crippled the vital Strait of Hormuz shipping lane, leading to the biggest oil supply disruption in history. Gasoline prices last week posted the biggest three-day increase since Hurricane Katrina in 2005, according to an analysis by Bespoke Investment Group.
Before this month’s spike, average gasoline prices across the country had fallen to their lowest since 2021, according to AAA. Data shows prices remain well below records seen in the aftermath of Russia’s invasion of Ukraine in 2022.
President Donald Trump on Monday predicted the war would end “soon,” giving consumers hope that the suffering might ease in the near future. Defense Secretary Pete Hegseth said Tuesday would be the “heaviest day of attack” in Iran.
U.S. oil prices have soared, recently hovering around $84 per barrel after topping the $100 mark earlier this week. Amin Nasser, CEO of Saudi oil giant Aramco, said on Tuesday that war could have “catastrophic consequences” for global oil markets.
“We have faced turmoil in the past, but this is the biggest crisis the region’s oil and gas industry has faced to date,” Nasser said.
affordable price
Rising gas prices threaten to undermine Trump’s focus on reducing the cost of living, which was a pillar of his re-election campaign. Affordability remains a top political issue heading into this November’s U.S. midterm elections, which will determine whether President Trump’s Republicans retain control of Congress.
Earlier this year, President Trump said at the World Economic Forum in Davos, Switzerland, that there is “virtually no inflation” in the United States, and cited sliding energy costs as an example of the United States “beating” inflation.
“Grocery prices, energy prices, airfares, mortgage rates, rent, car payments are all going down, and they’re going down fast,” President Trump said at a forum in January, while gas prices hovered near multi-year lows. “We’ve done a hell of a job in 12 months.”
AAA spokeswoman Aisha Diaz said gas prices tend to rise at this time of year, unrelated to war, as the spring break season begins. Consumers should expect summer-blend gasoline to hit the market in late spring, and it will cost more than the winter-blend gasoline currently sold.
“These factors and higher oil prices are leading to higher pump prices,” Diaz told CNBC. “No one knows how much gas prices will rise. Oil is a volatile global commodity.”
Raymond James analyst Bobby Griffin said the amount consumers will pay going forward will be determined in part by the length of the market disruption.
He said if oil prices continue to rise, retailers will have to “chase” price increases to alleviate margin pressure. Griffin said if oil prices stabilize at current levels, oil sellers will see margins squeezed for several weeks.
Even if oil prices fall, buyers may not expect prices to drop anytime soon because retailers are not likely to pass cost savings on to drivers immediately, analysts said.
—CNBC’s Spencer Kimball and Dan Mangan contributed to this report.
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