US Gasoline Set to Break $4 Per Gallon! Analysts Warn: Even If Conflict Ends, Oil Prices Won't Return to Previous Levels…

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Source: Cailian Press

Cailian Press, March 20 — (Editor: Liu Rui) As the US and Israel’s attacks on Iran ignite conflict, US gasoline prices have also surged dramatically: from the beginning of this month to now, the average retail gasoline price in the US has increased by 90 cents per gallon, a rise of over 30%, now approaching $4 per gallon.

For the “car country” of the US, rising gasoline prices significantly impact the cost of living for American consumers. As midterm elections approach, stabilizing fuel prices quickly has become a top priority for the Trump administration.

However, many analysts point out that the conflict in Iran will continue to push oil prices higher, and even if the Iran war ends quickly, short-term gasoline prices may still struggle to fall below $3 per gallon.

US Gasoline Prices Near $4 Per Gallon

According to data from the American Automobile Association (AAA), as of Thursday Eastern Time, the national average retail gasoline price in the US was $3.88 per gallon. Meanwhile, US West Texas Intermediate (WTI) crude futures rose nearly $30, up 43%, from $67.02 to $96.14 per barrel.

Analysts say that as crude oil prices continue to soar, US retail gasoline prices are also expected to increase. GasBuddy analyst Patrick De Haan predicts:

“It looks like next week, US gasoline retail prices will reach $4 per gallon and may continue to rise to $4.10 or even higher.”

If US gasoline prices break through the $4 per gallon mark (the last time reaching this level was in August 2022), it will further increase the cost of living for American consumers.

Comparison of US Gasoline Price Trends Over the Past Four Years

Short-term gasoline prices are unlikely to fall

For Trump and the Republican Party, preventing rapid fuel price increases has become a top priority — with midterm elections coming in November, they need to curb inflation to try to maintain their slim majority in Congress.

But this is no easy task for the Trump administration.

Currently, the Iran conflict has disrupted shipping through the Strait of Hormuz, a crucial maritime route for transporting most of the Persian Gulf’s fossil fuel exports worldwide. As a result, oil exports from major Middle Eastern producers are impacted.

Analysts note that for US gasoline prices to drop rapidly, the fighting in the Middle East would need to cease quickly, and the Strait of Hormuz would need to reopen. But even if hostilities end swiftly, there’s no guarantee that gasoline prices will return to pre-war levels in the short term.

Many analysts predict that cooling of US gasoline prices will take a long time, including analysts within the Trump administration.

First, few ships are willing to traverse the Strait of Hormuz at present, with many oil tankers stranded at both ends. Even if hostilities cease and the strait reopens, the backlog of ships could take up to two weeks to clear.

Second, even after the war ends, Gulf region oil producers will need at least several weeks to restore operations — considering some infrastructure has been attacked and damaged, recovery could take even longer.

The US Energy Information Administration (EIA) believes that even if oil transportation through the strait resumes in April, US gasoline prices will remain high for months or longer, and “normalization of refining and retail margins will be slower.”

Additionally, this Friday (March 20) marks the spring equinox, signaling the official start of spring. The EIA notes that as temperatures warm and travel increases with the arrival of spring, US gasoline prices are likely to rise further due to seasonal demand.

While the EIA believes that US gasoline prices may have already peaked — with the gradual resumption of land transportation starting in April, international oil prices are expected to remain relatively moderate through 2026 and the rest of 2027.

However, even so, the EIA forecasts that from now until the end of 2027, US gasoline prices will not fall below $3 per gallon again.

The EIA also warns that its forecasts remain uncertain and could be revised upward or downward depending on the duration of the Middle East conflict, the severity of the Strait of Hormuz closure, and the time needed for Gulf producers to resume operations.

This means that although the Trump administration recently claimed that oil prices would soon fall below $3 per gallon, drivers may need more than a year to see prices drop below that level again.