New York

Fuel prices in the United States have surged past USD 4 per gallon for the first time since 2022, driven by global supply disruptions linked to the ongoing Iran-Israel conflict 2026.

According to the AAA, the national average price for regular gasoline reached USD 4.02 per gallon, marking a sharp increase of over USD 1 compared to pre-conflict levels. The last time prices were this high was in the aftermath of the Russian invasion of Ukraine.

Prices vary significantly across states depending on supply conditions and tax structures, with several regions already experiencing rates well above the national average.

The spike comes as crude oil prices—key to gasoline production—have surged due to disruptions in global supply chains following the escalation of hostilities involving the US, Israel, and Iran since late February. The effective halt of tanker movement through the Strait of Hormuz, which handles roughly 20 per cent of global oil shipments, has further intensified supply concerns.

Globally, consumers are also facing rising fuel costs. In Paris, for instance, gasoline prices have climbed to about 2.34 euros per litre, equivalent to over USD 10 per gallon.

Rising fuel prices are expected to have wide-ranging impacts on both households and businesses. Higher transportation costs are likely to push up the prices of essential goods, particularly groceries, which require frequent restocking.

Logistics and delivery sectors are also under pressure. The United States Postal Service has proposed a temporary 8 per cent surcharge on select services, including Priority Mail, to offset rising fuel costs.

Diesel prices, crucial for freight transport, have also surged, averaging USD 5.45 per gallon—up significantly from around USD 3.76 before the conflict began.

In response to the crisis, the International Energy Agency has pledged to release 400 million barrels of oil from emergency reserves. The US government has also taken steps such as easing certain sanctions to increase supply and temporarily waiving provisions of the Jones Act to facilitate fuel transportation.

However, analysts caution that these measures may take time to ease prices at the pump, as refineries often operate on previously purchased crude, delaying the impact of new supply.

Seasonal factors are also contributing to the rise. Increased travel demand and the transition to more expensive summer-grade fuel blends typically push prices higher during this period.

Despite being a net oil exporter, the US remains vulnerable to global price fluctuations. Oil is traded internationally, and the country still relies on imports suited to its refinery configurations.

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The current surge echoes previous spikes, including the record highs seen in mid-2022 following the Ukraine conflict. While prices had remained below USD 4 per gallon since August 2022, the latest geopolitical tensions have once again pushed fuel costs sharply upward.