Americans have spent nearly $45 billion more on fuel since the Iran war began on Friday (February 28), according to a report by researchers at Brown University. The conflict has disrupted global oil supplies, causing gas and diesel prices to soar. The blockade of the Strait of Hormuz has further exacerbated the situation, leading to a national average gas price increase of over 50%.
The Brown University report, titled “Iran War Energy Cost Tracker,” highlights the economic impact of the conflict. It estimates that Americans have spent about $24.97 billion extra on gasoline and roughly $19.85 billion on diesel since the war’s onset. The national average for regular gasoline climbed to $4.55 a gallon, with some analysts predicting prices could reach $5 a gallon if the blockade continues.
President Donald Trump has promised that gas prices will decrease once Iran agrees to a ceasefire. The administration is working with the International Energy Agency to release 400 million barrels of oil and refined products, including 172 million barrels from U.S. reserves, to mitigate the disruption. According to the New York Post, the Trump administration is also considering a temporary removal of the federal gas tax to ease the burden on consumers.
However, the rising fuel costs have already affected American households, especially lower-income ones. OilPrice.com reports that these households are facing eroded purchasing power, while affluent Americans see financial gains as the S&P 500 rallies.
As the conflict continues, the economic repercussions are expected to persist, affecting transportation, shipping, and consumer goods prices. The situation remains uncertain, with analysts warning of further price hikes if the Strait of Hormuz remains closed.
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