Global energy prices remain elevated and Americans continue to feel the pain of having to pay at the pump amid ongoing tensions in the Middle East.
The latest CPI data showed a 21.2% month-over-month increase in gasoline prices in March, the largest monthly increase since the CPI was first published in 1967. The national average price of a regular gallon of gasoline reached $4.118, and the average cost of diesel continues to rise to $6 per gallon.
Recently, news of the two-week temporary ceasefire had a positive impact on global markets and oil prices, but drivers have yet to feel any significant relief. Meanwhile, the Strait of Hormuz remains largely closed and markets are focused on any sign of new talks between the United States and Iran.
Read more: Gasoline is over $4 and diesel is over $5. How a prolonged war with Iran could drive up prices.
Changes in crude oil prices have the power to impact gas prices quite quickly; However, the fall from an increase in the price of gasoline is not always immediate.
While oil prices are certainly a key indicator of how gas prices may rise or fall, it’s just one of many factors that can influence how much you pay at the pump. Other factors, such as refining costs, disruptions to gasoline distribution and retailers’ price margins, can slow the pace at which gasoline prices return to normal after a spike.
“There’s a saying that pump prices rise like a rocket and fall like a feather, and that holds true,” said David Doherty, head of natural resources research at BloombergNEF. “It takes about three weeks for crude oil price increases to be fully felt in the price of gasoline, and it may take just as long for them to decline as refiners face an uncertain outlook when it comes to the price of crude oil, their main ingredient.”
Doherty says prices will skyrocket very quickly if the ceasefire breaks.
“Markets are already very concerned about developments in the Gulf, and at $95-100 a barrel, they are pricing in some skepticism,” Doherty said. “If the world was not affected by this, we would expect the fair value of Brent oil to be closer to $65 per barrel.”
For now, there is no real solution to the current conflict in the Middle East that would be necessary to begin regulating the volatility in the oil market.
On April 7, as the conflict entered its fifth week, President Trump announced a temporary two-week ceasefire agreement between the United States and Iran, demanding the “complete, immediate and secure opening” of the Strait of Hormuz.
Stocks soared after this announcement and oil prices fell well below $100 per barrel for the first time since the start of this conflict. However, concerns remain over this ceasefire and whether it is truly safe for tankers to cross, as Iran continues to maintain control over traffic passing through the Strait, with some reports imposing tolls on tankers crossing the Strait.
President Trump responded in a post on Truth Social, stating, “They better not be, and if they are, they better stop now.”
In the days since the ceasefire was announced, ship tracking data has shown that only a handful of ships crossed the Strait each day, compared to more than 100 per day before the war. Over the weekend, peace talks in Islamabad ended without an agreement and the US military announced plans to blockade all Iranian ports, sending oil prices back above $100 a barrel.
In an interview with Fox News’ “Sunday Morning Futures,” President Trump said gas prices could still be elevated heading into the midterm elections.
“Gas prices still depend on adrenaline, not fundamentals. The more enthusiasm, the bigger the spike, and crude oil drives about half of the move,” said Maksim Sonin, an energy executive with Stanford University’s Center for Future Fuels.
“No one is in a hurry to be the cheapest in town,” Sonin said. “Margins tend to expand along the chain while the window is open. Some relief may come, but it will likely be location-specific, with weeks turning into months, to settle. And even longer if another wave of adrenaline is just around the corner.”
Read more: The best credit cards for gas.
Here at home, steps are being taken at the federal level to ease the financial burden of rising gas prices on ordinary Americans.
This includes the government’s EPA emergency waivers, which allow nationwide sales of E15, gasoline blended with 15% ethanol, and the removal of all federal impediments to the sale of E10, gasoline blended with 10% ethanol, nationwide. The EPA says this move will prevent disruption to America’s fuel supply by keeping E15 on the market and giving Americans more fuel options.
Additionally, in March, the Trump administration ordered the release of 172 million barrels of oil from the US Strategic Petroleum Reserve (SPR) along with the 32 member countries of the International Energy Agency, who unanimously agreed to release a total of 400 million barrels of oil from their emergency reserves to address the global disruption.
Read more: What is the Strategic Petroleum Reserve? Can it help reduce gas prices?
At the state level, some states are implementing fuel tax breaks to help residents reduce their costs.
Experts say that given the current situation in the Strait of Hormuz, it is unclear exactly when prices will fall. “Obviously, the current situation has really impacted our ability to accurately predict beyond the situation,” Patrick De Haan, head of oil analysis at GasBuddy, said in an interview with Yahoo Finance. “I still tend to believe things could normalize within three to six months from now. Our previous 2026 fuel outlook saw gas prices falling below the $3 mark later this year. Obviously, the current situation may negate that a bit.”
The good news: De Haan said that generally speaking, it only takes a couple of days for changes in the price of oil to be transmitted to the retail level.
In the meantime, there are several ways consumers can take action to save money on fuel.
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Join Fuel Rewards Programs: If you frequent a particular gas station, see if it offers a fuel rewards program you can join to start racking up rewards or earn a few cents off every gallon.
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Comparison shop: Stopping at the nearest gas station may be the most convenient option for getting gas, but it may not be the most cost-effective. Before you fill up on gas, shop around and compare stations to make sure you’re getting the best price possible.
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Get a Gas Rewards Credit Card: If you’re looking for a new credit card, consider opting for one that offers cash back or points every time you fill up to help minimize the cost of high gas prices on your budget.
Read more: How a gas card can help you beat high prices at the pump