Gas Prices Surge as US–Israel War With Iran Rattles Global Oil Markets | The American Spectator

On Monday, the U.S.–Israel war with Iran pushed oil prices to their highest level since July 2022. Since the war began in late February, the national average price of gas has steadily increased. It’s now $3.48 for a gallon of regular, up 48 cents since last week and 58 cents from a month ago, according to AAA data.

However, there are no signs of worry from the White House. Energy Secretary Chris Wright said on CNN Sunday that “in the worst case, this is a week’s, this is not a month’s thing.” That echoed President Donald Trump’s comments to Reuters that prices will “drop very rapidly when this is over, and if they rise, they rise.”

In a Truth Social post on Sunday, the president voiced his disdain for the “fools” concerned with rising gas prices, arguing the “short-term oil prices” are a “very small price to pay for U.S.A., and World, Safety and Peace.” Trump again said he expects prices to “drop rapidly” when the war ends.

Red states in particular are feeling the pain of rising gas prices, with some seeing price spikes of more than 30 cents in the last week, while 17 other states have “seen increases of more than 25 cents on average,” according to the Daily Beast. 

While the U.S. is a leading oil producer and relatively insulated by physical distance, our connection to the global market means we can’t decouple domestic prices from disruptions abroad. Typically, a $10 rise in crude oil translates to a roughly $0.25 hike in domestic gas prices, according to the Federal Reserve Bank of Dallas.

The war with Iran has already caused a near-12 percent spike in American diesel futures. Shipping disruptions, such as closing the Strait of Hormuz — or insurers’ decisions to suspend coverage for ships in that region — could lead U.S. refiners to increase their exports, a move that would further raise domestic gas prices.

Responding to the signs of consternation, President Trump ordered the United States Development Finance Corporation to provide risk insurance “at a very reasonable price” for “all Maritime Trade, especially Energy, traveling through the Gulf.” The Development Finance Corporation stated it will insure losses “up to approximately $20 billion on a rolling basis” to “vessels that meet the criteria.” However, the criteria and timeline for implementation are currently undetermined. 

President Trump also offered the services of the U.S. Navy to escort tankers through the Strait “if necessary.” Wright told Fox News that “one large tanker has already gone through the straits with no issues at all.” The strait previously averaged about 100 tankers and cargo ships a day.

Wright also joined Trump in downplaying suggestions that the Trump administration might tap the U.S. Strategic Petroleum Reserve, noting that while the U.S. is “happy to use” it, the pinch is being felt more acutely in Europe and Asia, not domestically. The president also rejected the idea on Sunday, stating, “we’ve got a lot of oil” and that the situation “will get healed very quickly,” according to CNBC.

Gas prices are currently highest in California, at an average of $5.20 per gallon. Kansas has the country’s lowest average price for a gallon of regular, at $2.92, according to AAA data.

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