NEW YORK — US gas prices rose above an average of $4 a liter for the first time since 2022 on Tuesday as the war in Iran pushed up global fuel prices.
According to the AAA motor group, the national average for a gallon of regular gasoline is now $4.02 – a dollar more than before the war. The last time US drivers paid that much at the pump was about four years ago, after Russia’s invasion of Ukraine.
The price is a national average, meaning drivers in some states have been paying more than $4 a gallon for a while now. Prices vary from country to country due to different conditions from nearby properties to different tax rates.
Since the US and Israel launched a joint war against Iran on Feb. 28, the price of crude oil – the main component of gasoline – rose and rose rapidly. That’s because the conflict has caused serious supply disruptions and cuts from major oil producers across the Middle East.
Higher gas prices are affecting consumers and businesses as more families continue to face the widespread costs of health problems. And while drivers are paying more for necessities like gas, many may have to cut back on their budget elsewhere.
High fuel prices can also increase other costs, from utility bills to the cost of many of the goods that consumers buy each day.
More recently, analysts point to grain, which must be returned frequently, and could see price increases as the cost of corporate transportation increases.
But hauling goods and other packages is also affected. For example, the United Postal Service wants a temporary 8% fee on some of its popular products including Priority Mail.
Diesel, the fuel used for many delivery and delivery trucks, now costs as much as $5.45 a gallon, up from $3.76 before the war, according to AAA.
If the war continues, those prices are likely to rise even further. Most of the ships in the Strait of Hormuz, through which about a fifth of the world’s oil usually passes, are still at a standstill. This has led to cuts from major producers in the region who have no means of getting their products to market. Meanwhile, Iran, Israel and the US have all seized oil and gas resources, further exacerbating supply concerns.
While seeking some help, the International Energy Agency promised to release 400 million barrels of oil from the emergency storage of member countries. That includes the US, although Trump initially downplayed the need for oil reserves.
The Trump administration has also eased sanctions to free up some oil from Venezuela, and temporarily from Russia. The White House also said it is lifting cruise ship requirements under the more than century-old law, known as the Jones Act, for 60 days.
It is not yet clear whether the effort will bring relief to consumers. Many factors contribute to the price of gas.
Refineries buy crude oil in advance, which means some may run on more expensive oil for a while, and it will take time for any new supply to trickle down to consumers.
And while peak prices are driving today’s activity, US gas prices tend to rise slightly this time of year. Many drivers are hitting the road and trying to burn as much fuel as they can, so demand is high. The warmer weather is also bringing a shift to summer blend fuels, which are more expensive than winter blends.
The US, which is an oil exporter, has not seen the same phenomenon as other parts of the world that are heavily dependent on imports from the Middle East, especially Asia. But that doesn’t mean America won’t have inflation.
Oil is a globally traded commodity. And most of what the US produces is light, sweet – but the developments on the East and West coasts are designed to handle a heavy, sour product. As a result, the country also needs imports.
Escalating political conflicts have disrupted the flow of oil and contributed to the rise in gas prices in the past. The U.S. average for regular gasoline rose to its highest level of more than $5 a liter in June 2022, nearly four months after the war in Ukraine began and world leaders imposed sanctions against Russia, a major oil producer.
Oil prices later fell from that record. Before Tuesday, according to AAA data, the national average had sat below the $4 mark since mid-August 2022.
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