Drivers across the country are feeling the pinch at the gas pump again, with the national average price for gasoline climbing back above $4 per gallon on Monday as renewed hostilities between the U.S. and Iran have disrupted oil movement through the Strait of Hormuz — a vital corridor for the world’s oil supply.
According to data from the American Automobile Association, the average retail price for a gallon of gasoline hit $4.0030 on Monday. That represents a rise of more than 30% since the U.S. and Israel launched attacks on Iran at the end of February.
The $4-per-gallon threshold, a level widely considered a point of serious financial strain for American families, was last seen in late March after Iran shut down traffic through the Strait of Hormuz. Prices had dropped back below that mark in June following the signing of a memorandum of understanding between the U.S. and Iran to end the conflict.
Prior to the war with Iran, roughly 20% of the world’s oil supply passed through the strait each day.
The surge in fuel costs has turned into a political headache for U.S. President Donald Trump and the Republican Party, which is preparing to defend narrow majorities in both chambers of Congress during November’s midterm elections.
Gasoline prices moved higher alongside crude oil, which jumped approximately 16% this week after the ceasefire agreement between Washington and Tehran fell apart in early July. Retail fuel prices and crude oil tend to track each other closely, since crude is the primary ingredient — and cost — in producing gasoline.
Energy prices have received additional upward pressure from the loss of Russian refining capacity, as Ukraine has stepped up strikes on Russian energy infrastructure.
Tight fuel supplies in the United States are also contributing to the price increases. Government figures show domestic fuel stockpiles sat at 210.5 million barrels last week, roughly 1.5 million barrels below the five-year average.
