The national gasoline average has reached $3.70 in the US, up 23% since the Iran war began three weeks ago, and analysts warn that prices could climb higher still on Monday. Petroleum expert Patrick De Haan has forecast that the average could reach $3.85 per gallon, while cautioning that $4 gas remains possible. The conflict has pushed US energy prices into territory that is being felt in household budgets across the country.
The escalation in prices traces back to February 28, when the US and Israel launched their campaign against Iran, a conflict that has systematically eroded global oil supply and confidence. From a pre-war average below $3 per gallon, the steady climb to $3.70 reflects three weeks of progressive damage to oil production, processing, and shipping infrastructure. The price increase has fallen unevenly on American consumers, with those in high-cost states like California bearing the greatest burden.
The US assault on Kharg Island on Friday, one of Iran’s most strategically vital oil processing hubs, added a new chapter to a conflict already defined by its energy market impact. Iran’s continuing blockade of the Strait of Hormuz has kept roughly 20% of global oil supply bottled up and unavailable to international buyers. Brent crude fluctuated between $103 and $106 per barrel Monday, and US crude settled near $94 following a Sunday spike to $100.
California consumers face the most acute situation, with state averages above $5 per gallon and certain Los Angeles stations listing prices above $8. Diesel for commercial transport could hit $5.05 to $5.15 per gallon nationally. The heads of Exxon, Chevron, and ConocoPhillips have all raised alarm with White House officials about the deteriorating supply situation, with Exxon’s Darren Woods specifically warning that speculative traders could accelerate price increases beyond what supply conditions alone would justify.
US stocks showed modest gains Monday morning, with the S&P 500 rising roughly 1% following a brief retreat in oil prices. Oil company shares have hit record highs since the conflict began, even as the broader economy grapples with the inflationary effects of elevated energy costs. The energy market will remain in turmoil for as long as the military conflict and the associated shipping disruptions continue.
