Gas prices may reach $4 within the coming month as the conflict in Iran intensifies

Gasoline Prices Surge Amid Strait of Hormuz Disruption

Over the past week, gas prices have jumped by almost 50 cents, and experts warn that the national average could soon reach $4 per gallon. This spike comes as tanker movement through the Strait of Hormuz—a vital passage for global oil shipments—has come to a near standstill.

On Sunday night, oil prices (CL=F) soared past $110 per barrel. The halt in traffic through this key corridor, which typically carries about 20% of the world’s oil, follows escalating threats of attacks from Iran.

For every $10 rise in crude oil, Americans can expect to pay an additional 25 cents per gallon at the pump.

Patrick De Haan of GasBuddy predicted on Sunday that there is about an 80% likelihood the national average for gasoline will hit $4 per gallon within the next month, if not sooner. He added that the current average of $3.45 could rise to between $3.75 and $3.95 just this week.

If gas prices surpass $4 per gallon, it would be the first time since August 2022 that Americans have faced such high costs at the pump. Just a week ago, the national average was $2.99 per gallon; it now stands at $3.47, according to AAA.

This rapid increase means Americans could collectively spend an extra $187 million each day on fuel compared to last week.

Diesel prices are climbing even more rapidly. Diesel costs could reach $5 per gallon nationwide this week—a level not seen since December 7, 2022—with De Haan estimating an 85% chance of this happening.

Currently, the national average for diesel is $4.66, up from $3.77 just a week prior. This surge has far-reaching effects, as higher transportation costs drive up prices for goods across the board.

With most products in the US moved by freight, everything from food and clothing to building materials is likely to become more expensive.

Terry Lytar, 65, fills up at a Shell station on West Olympic Boulevard in Los Angeles on March 3, 2026. (Kayla Bartkowski / Los Angeles Times via Getty Images)

Economic Concerns Grow as Energy Costs Climb

The threat of an energy crisis has heightened fears of stagflation on Wall Street, especially as oil prices surge and recent labor data from the US Bureau of Labor Statistics fell short of expectations.

JPMorgan analysts noted in a Monday report that “concerns about stagflation are rising in the US.”

Nigel Green, CEO of deVere Group, also warned that the combination of accelerating inflation and slowing economic growth is a “very real possibility.”

“Oil is the spark,” Green explained. “When energy prices rise this sharply, inflation picks up almost everywhere. Companies face increased costs, households see higher bills, and economic growth is squeezed all at once.”

Markets Await New Inflation Data

This week, Wall Street will be paying close attention to the latest inflation figures. However, Wednesday’s Consumer Price Index report, which covers February, reflects a period before the recent Middle East conflict began.

JPMorgan cautioned that if inflation comes in higher than expected due to the ongoing situation in Iran, worries about stagflation could intensify and put pressure on the stock market.