According to fuel-tracking platform GasBuddy, nationwide pump prices are expected to breach the $3 mark for the first time this year. Prices last crossed that threshold in November 2025 and had fallen as low as $2.85 per gallon in February
Average US retail gasoline prices are poised to climb above $3 per gallon on Monday for the first time in more than three months, after escalating hostilities between the United States and Iran disrupted global crude flows and sent oil benchmarks sharply higher, analysts said.
According to fuel-tracking platform GasBuddy, nationwide pump prices are expected to breach the $3 mark for the first time this year. Prices last crossed that threshold in November 2025 and had fallen as low as $2.85 per gallon in February.
Patrick De Haan, an analyst at GasBuddy, said crude oil would react first to geopolitical shocks, with retail fuel prices following gradually. “Oil will move first. Gasoline will follow — but gradually,” he wrote in a blog post after the strikes.
The spike comes after US and Israeli air strikes on Iran that killed Supreme Leader Ali Khamenei, triggering retaliatory threats and raising concerns over supply disruptions in the Middle East.
Strait of Hormuz in focus
Iran, one of the world’s top oil producers, has said it has shut navigation through the Strait of Hormuz following the attacks. The waterway is a critical artery for global energy trade, with roughly a fifth of the world’s oil transported through it by tanker.
At least three tankers have reportedly been damaged in the region, while major shipping companies have indicated they may avoid the strait. Global benchmark Brent crude jumped about 10 per cent to around $80 a barrel in over-the-counter trading on Sunday, with some analysts warning prices could test $100 if the conflict deepens.
Bob McNally, president of Rapidan Energy Group, said the White House appears willing to accept the political risks associated with higher fuel prices in pursuit of foreign policy objectives.
“Their eyes are wide open to the risk, and I expect they will focus on shortening the amount of time Iran has to control the flow of energy through the Strait of Hormuz,” McNally said.
He added that the administration could signal a willingness to release crude from the US Strategic Petroleum Reserve (SPR) if prices surge excessively. A historic drawdown of the SPR was authorised in 2022 under former President Joe Biden following Russia’s invasion of Ukraine — a move sharply criticised by President Donald Trump and other Republicans at the time.
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Seasonal pressures add to strain
Gasoline prices were already trending higher before the strikes, as US refiners began switching to more expensive summer-grade fuel blends mandated by environmental regulations to curb emissions during warmer months.
Tom Kloza, senior adviser for fuel supplier Gulf, said that even without geopolitical turmoil, prices were on track to reach $3.10–$3.25 per gallon amid seasonal demand.
“We were all set to rise to $3.10–$3.25 a gallon with a peaceful Persian Gulf. We’ll now get there very quickly and the action of the last 48 hours puts higher numbers in play,” Kloza said.
He estimated that a $5-per-barrel increase in crude oil typically translates into a roughly 12-cent-per-gallon rise in gasoline and diesel prices. However, some suppliers have already lifted wholesale prices by as much as 25 cents per gallon.
Demand for gasoline traditionally peaks during the US summer driving season, adding further upward pressure.
Inventory cushion, but volatility ahead
Despite the immediate price spike, high US fuel inventories could help cushion the blow. Government data show US gasoline stocks stood at 254.8 million barrels as of February 20 — near their highest level since the coronavirus pandemic — representing about 30 days of supply.
The recent rally marks a reversal from months of price declines driven by strong inventory levels and relatively weak demand growth through much of last year.
“I expect a lot of volatility tonight, but markets will likely start to settle down a bit after the first furious hour,” De Haan said.
With inputs from agencies.
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