The national average for U.S. gas prices climbed above $4 a gallon on Monday, as a renewed escalation in the Iran war stirred fresh concerns about a potential disruption to global oil supplies.
According to AAA, drivers are now paying an average of $4.003 per gallon at the pump, after prices rose 13 cents over the past week — an increase of roughly 3%.
The latest spike pushes fuel costs back toward levels seen shortly after the Iran war erupted in late February. That conflict rattled energy markets after Iran shut down the Strait of Hormuz, a critical shipping corridor that carries about one-fifth of the world’s oil supply. The resulting disruption sent gasoline prices sharply higher.
Calculator not displaying correctly? Click here to open in a new window.Gas prices had briefly dipped below $4 a gallon last month after the U.S. and Iran reached a preliminary deal intended to bring the war to an end. Before the current conflict, the last time national fuel prices were above $4 was in August 2022, in the aftermath of Russia’s invasion of Ukraine.
But hopes for a lasting resolution have dimmed in recent days after a new round of strikes between the U.S. and Iran reignited broader fighting.
President Donald Trump said Sunday that the U.S. struck Iran “hard,” describing the action as a response to the deaths of American service members killed by Iran over the weekend.
U.S. Central Command reported that two service members were killed Friday in an attack in Jordan, while a third remained missing. CENTCOM also said another American service member was killed Saturday in Iraq.
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Last week, the U.S. reinstated its naval blockade of the Strait of Hormuz, rolling back a major pledge included in the earlier agreement. The decision followed Iranian fire directed at oil tankers moving through the strait.
The Iran war triggered one of the largest oil shocks ever recorded, sending the national average price of gasoline as high as $4.56 a gallon on May 21, AAA data showed.
Oil and gasoline prices began to fall in late May, however, as Iran and the U.S. appeared willing to strike an agreement that would reopen the strait. By late June, those prices gad fallen fell to their lowest level since before the war began.
Relief at the pump helped bring down prices overall. Inflation dropped more than expected in June as gas prices eased, federal government data on Tuesday showed.
Gas prices rose 3.5% in June compared to a year earlier, marking a retreat from a year-over-year inflation rate of 4.2% in the prior month. The reading for June marked the lowest inflation since March, though the pace of price increases remains more than a percentage point higher than its pre-war level.
Even after easing last month, overall inflation stands markedly higher than the Federal Reserve’s target rate of 2%.
ABC News’ David Brennan contributed to this report.
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