US Oil Prices Driven Higher by Iran War as Consumers Feel the Financial Squeeze

American consumers are feeling an increasing financial squeeze as the Iran war drives US oil prices higher heading into its third week. Analyst Patrick De Haan forecasts that Monday’s average pump price could reach $3.85 per gallon, while $4 fuel remains within reach. The sustained conflict has turned a geopolitical crisis into a very personal economic issue for millions of American drivers and businesses.
The price increases began on February 28, the day the US and Israel launched their campaign against Iran, and have continued without interruption in the three weeks since. The national gasoline average has risen 23% to $3.70 from under $3 before the conflict. Each new military development—strikes on oil facilities, shipping blockades, diplomatic standoffs—has added fresh pressure to an already strained supply picture.
The US strike on Kharg Island last Friday attacked one of Iran’s most critical oil processing assets, adding to the disruption caused by three weeks of conflict. Iran’s ongoing closure of the Strait of Hormuz has removed roughly 20% of global oil supply from world markets. Brent crude traded between $103 and $106 per barrel Monday, while US crude fluctuated near $94 after briefly touching $100 the previous day.
The harshest domestic price impacts have been concentrated in California, where the state average exceeds $5 per gallon and some Los Angeles stations are charging over $8. The trucking and freight transport industries face potential diesel costs of $5.05 to $5.15 per gallon. Top oil company executives from Exxon, Chevron, and ConocoPhillips have directly briefed White House officials on the worsening supply picture, with Exxon’s CEO Darren Woods specifically warning about the role of market speculators in amplifying price increases.
Wall Street found its footing Monday as oil prices briefly pulled back, with the S&P 500 climbing about 1% from its opening level. Oil sector stocks have surged to record highs overall since the conflict began, creating a sharp contrast with the financial stress experienced by ordinary consumers. The economic outlook will remain challenging until the military conflict resolves and normal oil supply flows are restored.