US pump prices surge as Iran war upends global energy supply
MARIETTA/NEW YORK, March 6 (Reuters) - U.S. retail gasoline and diesel prices are soaring as the U.S.-Israel war with Iran constrains oil and fuel exports, which could be a political test for President Donald Trump's Republican Party ahead of midterm elections in November.
Fuel
prices jumped more than 10% this week as oil rose above $90 a barrel,
its highest in years, adding pain at the pump for consumers already
strained by inflation. Trump on Thursday shrugged off higher gasoline
prices in an interview with Reuters, saying "if they rise, they rise."
The
president had vowed to lower energy prices and unleash U.S. oil and gas
drilling during his second term, but much of his tenure has been marked
by volatility and uncertainty amid shifts in policies like tariffs and
geopolitical turmoil. The U.S.
is the world's largest oil producer. It is a major exporter but also
imports millions of barrels a day since it is the world's largest oil
consumer.
As
of Friday, the national average prices for regular gasoline stood at
$3.32 a gallon, up 11% from a week ago and the highest since September
2024, according to data from the motorists association AAA. Diesel was
at $4.33, up 15% from a week ago, surging to the highest since November
2023.
MIDWEST, SOUTH FEEL THE PINCH
U.S.
motorists in parts of the Midwest and the South, including states that
supported Trump, have seen some of the steepest increases in fuel costs
since the conflict in Iran started.
In
Georgia, a swing state, average retail gasoline prices rose 40.1 cents a
gallon over the past week, according to fuel tracking site GasBuddy.
Andrenna
McDaniel, a healthcare insurance worker in South Fulton, Georgia, said
she was surprised to see prices skyrocket overnight.
"They jumped up so quickly," she said on Friday, adding that she does not agree with the war at all.
McDaniel,
a Democrat, said that for now she is only driving for the most
important things, and feels lucky that she works from home so she does
not have to drive as much as other people do.
Georgia voted for Donald Trump in the 2024 election.
Trump
voter Richard Soule, 69, a U.S. Air Force veteran and a retired
firefighter, said a little pain at the pump is worth Trump's efforts to
protect America.
Gasoline
prices are displayed at a gas station price display, in Carlsbad,
California, U.S., March 3, 2026. REUTERS/Mike Blake/File Photo Purchase Licensing Rights
"When
President Trump went in there and bombed out their nuclear, and they
just thumbed their nose at it, I believe he did the right thing at the
right time," Soule said on Friday as he filled up his Ford F-150 truck
in Marietta, Georgia.
Other states, including Indiana and West Virginia have seen prices rise by 44.3 cents and 43.9 cents, respectively.
PRICES MAY RISE FURTHER
More
pain may be on the way, analysts said, as oil prices continue to trend
upward. On Friday, U.S. oil futures settled at $90.90 a barrel, up
nearly $10 and the biggest single-day rise since April 2020.
"Given
current market conditions, the national average price of gasoline could
climb toward $3.50 to $3.70 per gallon in the coming days if oil
continues rising and supply disruptions persist," GasBuddy analyst
Patrick De Haan said.
The
disruptions in the Middle East and the Strait of Hormuz, a key trade
conduit, have boosted demand for U.S. oil abroad, which in turn has
driven up prices for domestic refiners too.
"The
U.S. has weaned itself off of its dependence on Middle Eastern crude,
but obviously Asian refineries, and to a lesser extent, European
refineries have not," Denton Cinquegrana, chief oil analyst with OPIS.
"That's what you're seeing happen in the spot market, because the demand
for U.S. exports rise, and so the price rise."
Seasonal
factors could add further pressure. Gasoline prices typically go up
in the spring and peak in the summer due to higher gasoline demand and
production of summer-blend gasoline, which is more costly to produce.
Diesel fuel saw an even more aggressive jump since Iran began retaliating against U.S. and Israeli strikes, significantly disrupting shipping in the Strait of Hormuz.
Global
diesel inventories have remained in tight supply due to heavy demand
for heating and power generation during a prolonged winter in the U.S.
and other parts of the world and a structural tightness of refining
capacity.
Sticker
prices of everything from food to furniture go up when the cost of
diesel goes up, as the fuel is mainly used in freight transportation,
manufacturing, agriculture, and global shipping, analysts said.
"In a world where buzzword seems to be 'affordability', that is certainly not going to help," Cinquegrana said.
Reporting by Nicole Jao, Jayla Whitfield-Anderson and Rich McKay; Editing by Liz Hampton and David Gregorio
Our Standards: The Thomson Reuters Trust Principles.
US energy chief defends waiver on Russian oil sanctions, blames fear for higher gas prices
Energy · · 24 mins agoTrump administration officials on Sunday defended a decision to temporarily lift some sanctions on Russian oil and predicted that a sharp increase in gasoline prices resulting from the Iran war would last only weeks.
No comments:
Post a Comment