The national average price for a gallon of regular gasoline remained above $4 every day in August for the first time, according to AAA.

August is also on track to become the most expensive August ever at the gas pump, surpassing the monthly average of $3.97 recorded in 2022.

The national average price for a gallon of regular gasoline stood at $4.08 on Aug. 31, according to AAA. A year ago, it was $3.18.

Despite declining gasoline demand, elevated crude oil prices and continued volatility surrounding the Strait of Hormuz have kept gas prices persistently high ahead of the Labor Day weekend.

Brent crude, the international benchmark, climbed above $90 a barrel on Monday, while the U.S. benchmark crude traded above $86. By comparison, crude oil averaged around $67 a barrel during Labor Day weekend in 2025.

States where gas prices are already above $5 a gallon

In some states, average prices have climbed well above $5 a gallon. California tops the list as the most expensive gas market in the country, with an average of $5.63 per gallon, followed by Hawaii at $5.41 and Washington at $5.27.

Other Western states are also among the most expensive, including Arizona, at $4.54, and Utah, at $4.40.

Meanwhile, some states have managed to stay below $4. Indiana has the lowest average in the country, at $3.46 per gallon, while Texas stands at $3.63.

When could relief come?

As the war with Iran reaches six months and tensions surrounding the Strait of Hormuz continue to put pressure on oil prices, the Trump administration is looking to Venezuela as a potential additional source of supply.

President Donald Trump announced Friday that the United States had signed an agreement with Venezuela that includes access to 65 billion barrels of oil reserves. According to the president, the agreement will help ease the pressure Americans are feeling at the gas pump.

However, experts warn that relief is unlikely to come soon, as significantly increasing Venezuela’s oil production would require substantial investment and improvements to the country’s aging oil infrastructure.

The agreement could be “useful in the long run, but it’s not going to do anything to change the price of gasoline at the pump over Labor Day weekend,” Amy Myers Jaffe, director of New York University’s Energy, Climate Justice and Sustainability Lab, told The Associated Press.

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Trump in a social media post announced the agreement he said was negotiated by Secretary of State Marco Rubio, Defense Secretary Pete Hegseth and Venezuela’s acting President Delcy Rodriguez.

“The United States of America has just entered into an Agreement with the Country of Venezuela on, THE BIGGEST OIL DEAL IN WORLD HISTORY!” Trump wrote.

Rodríguez’s government in a statement said the deal involves the development of 17 fields with a proven potential of 65 billion barrels. It said the agreement could draw $100 billion in investment into Venezuela’s oil industry and yield over $209 billion in taxes for Caracas.

Rodríguez in a posting on Telegram predicted the deal “will have a significant impact on our nation’s revival.”

The agreement allows for the United States to partner with an unnamed private operator in Venezuela to create a new private company to take hold of the reserves, according to a U.S. official familiar with the contours of the deal.

The official, who was not authorized to comment publicly and spoke on the condition of anonymity, added that Rodriguez granted the company 100-year rights to develop the oil fields.

The deal gives the United States 55% effective output of the new private company — including an ownership stake and rights to buy oil at cost. The company would be the second largest corporate holder of proven reserves after Saudi Aramco, according to the official.

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The announcement comes nearly nine months after the U.S. military at Trump’s direction carried out an operation to capture Venezuela’s president Nicolás Maduro and spirit him to the United States to face federal narcoterrorism and drug trafficking charges.

Trump faces mounting pressure to address high gas prices as the war in Iran on Friday reached a six-month milestone with no conclusion in sight. The U.S. has tapped its strategic petroleum reserves, which in early August fell below 300 million barrels, down by more than 100 million barrels since the start of 2026.

The U.S.-Israel war against Iran has led to a dramatic slowdown of Gulf oil moving through the Strait of Hormuz, which about 20% of the world petroleum passed through prior to the conflict.

The average price of gas in the U.S. stood at about $4.09 a gallon on Friday, according to AAA. The average price was $3.21 at the same time last year.

A significant drop in U.S. gas prices tied to the agreement should not be expected immediately. Experts have repeatedly warned that a substantial boost in Venezuelan oil production will not happen quickly as repairing and expanding infrastructure takes years and requires billions of dollars.

Persuading big American oil companies to return the region could face headwinds given the political uncertainty and decades of badly damaged infrastructure.

Days after the ouster of Maduro, Trump gathered oil executives at the White House and called on them to rush back into Venezuela. Executives expressed interest in the opportunity but there was also a measure of caution given their past experience in the country.

Darren Woods, CEO of ExxonMobil, the largest U.S. oil company, said at that moment he saw the country as “un-investable.”

But Trump has insisted that his administration has brought a measure of stability to Venezuela.

He has argued that Venezuela stole U.S. oil when former Venezuelan President Hugo Chávez moved decades ago to nationalize hundreds of foreign-owned assets, including those owned by American oil companies.

Rodriguez, in one of her early moves after taking power, signed a law that opens the nation’s oil sector to privatization and reversed a bedrock tenet of the self-proclaimed socialist movement that had ruled the country for more than two decades.

Rubio said on X that the agreement would usher in billions in private investment into Venezuela and lead to lower gas prices in the United States.

“This deal is a huge win for both the American and Venezuelan people,” Rubio posted.

The oil bought from the new company would go toward filling the U.S. strategic petroleum reserve and toward military use, according to the U.S. official.

Venezuela has one of the largest oil reserves in the world, with an estimated 303 billion barrels of crude oil in the ground. That’s about 17% of the world’s supply, according to the U.S. Energy Information Administration. Unlike other parts of the world, where geologists have to search for untapped oil, the reserves under Venezuela’s soil are largely mapped and known, experts say. But because of dilapidated infrastructure, the country only produces about 1% of the world’s oil.

Maduro remains jailed in the U.S. He has pleaded not guilty.

__

Garcia Cano reported from Caracas.

The conflict, now in its sixth month, halted most shipping through the Strait of Hormuz, a narrow waterway that previously served as a delivery route for a fifth of the world’s oil and natural gas. With global supplies constrained, prices for Brent crude, the international standard, soared from about $70 to above $100 a barrel for much of March, April and May, and at one point reached $126.

The money that oil companies accrued between the beginning of April and the end of June could receive extra scrutiny this year. Gasoline, diesel and jet fuel prices climbed sharply during that period, increasing costs for drivers and airline passengers. Supplies ran low in some countries, leading to sporadic fuel rationing in Australia and government office closures in Nepal and Sri Lanka.

Exxon Mobil on Friday reported that its second quarter profits doubled to $14.53 billion, boosted by record diesel production. The oil giant, based in Spring, Texas, brought in $116.02 billion in revenue, up 42%.

Chevron, based in Houston, nearly quadrupled its profits to $12.07 billion and revenue jumped 56% to $70.06 billion.

Six of Europe’s largest oil companies posted combined first-quarter profits of $22 billion, more than 40% higher than last year.

“There are constituencies around the world who are having a very good crisis, and the oil producers are one of them,” said Patrick Galey, fossil fuels lead at Global Witness, a nonprofit organization that investigates environmental issues. “When you compare that to the hundreds of millions of people who are struggling with rolling blackouts, with electricity curbs, rationing, waiting in line for food queues, or the disruption to fertilizers and the potential impact that that has on food prices, we don’t think that it’s a justifiable price for the rest of the world to be paying.”

Lawmakers propose taxing major oil producers for war windfalls

Energy companies such as Exxon and Chevron do not set the price of American oil, which ricocheted from $68 to $115 a barrel during the quarter. It’s driven by supply and demand, and what traders, refiners and other buyers are willing to pay.

Nevertheless, Democrats in Congress introduced bills in March to tax major oil producers for profits they show from 2026 onward and have the tax proceeds redistributed to consumers.

“It’s fair to put a windfall profits tax on inordinate windfall profits rather than cut off children’s food programs,” Sen. Sheldon Whitehouse, a Rhode Island Democrat who introduced the Senate version of the legislation.

Whitehouse’s measure and a companion bill introduced by U.S. Rep. Ro Khanna of California would amend the U.S. tax code to impose a per-barrel tax on companies that produced or imported at least 300,000 barrels of oil per day in 2025.

“We cracked $4 again per gallon last weekend in gas stations that I drove by, and that’s a big expense, particularly for families that get their income from driving around from job to job in the work van or the work truck,” Whitehouse said.

The average price for a gallon of regular gasoline in the U.S., which was below $3 before the U.S. and Israel launched attacks on Iran, reached $4.11 Friday, about $1 more than ast year at this time.

The UK and other European countries implemented temporary windfall profits taxes on fossil fuel companies in 2022. The UK extended that to 2030, according to Tax Foundation Europe.

“Penalizing the businesses who stood by those countries and provided that product going forward is very short-sighted,” Exxon CEO Darren Woods said in a call with investors Friday. “We canceled investments that we had planned for Europe based on the last time they passed a windfall profits tax.”

Refineries rake in cash while consumers pay more for fuel

Outfits such as Exxon and Chevron, which also own refineries, are in the best position to profit from the current market conditions, said Tom Seng, assistant professor of energy finance at Texas Christian University.

Refineries turn oil into gasoline, diesel, jet fuel and home heating oil. Higher prices for those products meant Chevron’s quarterly refinery profit was six times as big in 2026, despite processing less crude and selling less products.

“The return on refining, on a percentage basis, has skyrocketed,” Seng said. “Oil right now is priced what it is priced because of the Iran war. But in the meantime, the refineries are making money hand over fist.”

The global refining market is under-supplied, and with countries such as Russia and China no longer exporting, companies like Exxon and Chevron have to pick it up, said Rob Thummel, senior portfolio manager at Tortoise Capital. “The world is going to be short jet fuel, diesel and gasoline, so we’ll probably continue to see higher profits there.”

Globally, not all refineries have been able to get the supply of crude oil they need to meet demand since the conflict began, said Timothy Fitzgerald, a University of Tennessee professor of business economics who studies the petroleum industry.

As a result, refineries that have ample oil to work with, including those in the U.S., are turning high profits, particularly when they make jet fuel and diesel, which is priced about 41% higher in the U.S. than before the Strait of Hormuz was blocked.

“If you’re a company that owns a bunch of refinery capacity, things look pretty good,” Fitzgerald said.

American refineries are running at near-full capacity and poised to benefit because some refineries in the Middle East and Russia were damaged. And Asia can’t get the amount of Middle East oil needed for refining.

“Ultimately, users of the energy services pay,” Fitzgerald said. “Consumers, people like you and me buying retail motor gasoline or diesel fuel or airplane tickets. But it also means that almost everything else we buy has an embedded energy content to it … and this is where you start to worry about it driving increases in costs.”

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Not all oil and gas companies benefit in the same way

In the present geopolitical environment, some companies are winners while others are losers, Fitzgerald said.

“If you’re a company like a U.S. (oil) producer, even a U.S.-based international company like an Exxon or Chevron who’s got lots of production outside the Gulf, things are good. You’re selling your product at a higher price,” he said.

But companies in the Middle East that are not able to benefit from higher prices because they are struggling to get their liquefied natural gas out of the Persian Gulf or have a lot of damaged oil fields or processing facilities have a very different take on recent events, Fitzgerald added.

“Your ability to sell anything and the volume that you may be getting out is so curtailed that your revenues are way down and you’re incurring higher transportation costs and security costs,” he said.

Exxon and Chevron weren’t as profitable in the first quarter due to the way oil is traded; the first real opportunity they had to take advantage of higher prices oil was in April. Companies that had a lot of oil stored in floating tankers and available for spot-market trading, including some European ones, were able to benefit from March’s higher oil prices, Seng said.

The average price has risen 27.8 cents over the past 11 days, including 2.2 cents Friday, according to figures from the AAA and Oil Price Information Service. It is 17.6 cents more than one week ago, 17.4 cents more
than one month ago and $1.208 more than one year ago.

The average price has increased 98.9 cents since the start of the joint U.S./Israel attack on Iran on Feb. 28, which sent oil prices higher and drastically accelerated increases at the gas pump.

The Orange County average price rose for the 12th consecutive day, increasing 2.9 cents to $5.623. It has risen 32.5 cents over the past 12 days, including 3.1 cents Friday. The Orange County average price is 18.4 cents more than one week ago, 24.8 cents more than one month ago and $1.20 more than one year ago. It has increased 98.7 cents since the attack on Iran.

The national average price rose for the 11th consecutive day, increasing six-tenths of a cent to $4.111. It has risen 25.2 cents over the past 11 days, including 1.4 cents Friday. The national average price is 11.9 cents more than one week ago, 19.3 cents more than one month ago and 95 cents more than one year ago. It has increased $1.129 since the attack on Iran.

“Rising crude oil prices are behind the spike at the pump. Volatility along the Strait of Hormuz and instability in the region have pushed crude oil prices into the $90 per barrel range and could continue driving up costs during the second half of summer,” the AAA said on Thursday.

Untangling exactly who is behind the Philadelphia-area venture has proven difficult. Records indicate the chain, which was launched last month, is run by a disparate collection of businessmen that includes an NFL kicking coach, a GOP fundraiser and a New Jersey entrepreneur who this year was ordered, along with his brother, to pay civil damages for unlawfully taking more than 200,000 gallons of fuel.

How the stations got Trump’s attention remains a mystery, and the four businessmen declined to — or could not be reached for — comment.

What is clear: Trump loved the idea of cheaper gas. The president celebrated the network’s gas prices just before the busy July 4th travel period as consumers were grappling with higher oil prices sparked by the war with Iran.

“I am pleased to announce that a VERY smart Retailer, located throughout the Northeast, is stepping up,” Trump wrote about the company on his Truth Social platform on July 1. “America has never been stronger than it is now, and Gas Prices will soon be back to the Record Low Prices Americans enjoyed at the pump before our very successful ‘excursion’ in Iran.”

The White House followed up with a post on X a few days later that heralded the opening of the first Freedom Fuel station and produced a video showing patrons waving wads of cash and thanking Trump for reducing the prices outside a store festooned with American flags and a golden eagle logo.

That station, located in Dresher, Pennsylvania, is owned by a subsidiary of Blue Owl Capital, an investment firm, records show. Trump has owned up to $25 million worth of Blue Owl stock, though his most recent financial disclosure says he has sold almost all of that stake.

The White House denied Trump had any personal connection to the venture, but declined to say how the project was developed. It acknowledged having discussions with individuals who set up the network of gas stations.

“The Administration is not involved in the company, nor has the Administration given the company any funding. There is no other entity or person subsidizing the lower gasoline costs,” the White House wrote in a statement.

Blue Owl owns about a third of the Freedom Fuel properties, though the company said it leases the stores to independent contractors and “is not involved in the tenant’s operations or business decisions.”

Fourteen stations in the 25-location network are controlled by companies linked to Shamikh and Syed Kazmi, two brothers who have been dogged by a string of civil misconduct accusations, including fraud, records show.

Shamikh Kazmi is leasing eight of those stations from Blue Owl, according to state records and people familiar with the businesses who spoke on condition of anonymity to discuss the matter. The Associated Press was able to link the brothers to six other Freedom Network locations through records that show they listed those stations’ addresses as headquarters for other ventures or supplied those locations with fuel.

A White House official, who insisted on anonymity to discuss the project, said that no one at the White House who was in conversations with Freedom Fuel Network had specifically spoken or worked with Syed Kazmi, a claim that indicates discussions occurred with the other brother, Shamikh.

The Kazmis have marketed themselves as “top tier” petroleum distributors and gas station operators, with over 75 years of experience and a deep well of corporate affiliations, according to an archived version of the website for one of their companies.

Public records offer a more nuanced portrait, showing the Kazmis have been repeatedly sued by companies they had dealings with.

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The brothers have legal issues

Legal filings detail a series of judgments against the Kazmis, who failed to comply with a court order and have been accused of obscuring their finances and dodging service processors as a growing list of former suppliers and franchisors sought payment.

In February, a federal judge in New Jersey ordered the Kazmis to pay over $600,000 to a fuel supplier that accused the brothers of stealing gas. The supplier alleged in court filings that it cut the brothers off after they refused to sign a new contract. But the Kazmis exploited a security lapse and gained access to the supplier’s fuel depot. Over a ten-day period in August 2021, tanker trucks absconded with more than 230,000 gallons of fuel, according to the supplier’s court filings. A judge ruled in the supplier’s favor, finding the brothers unlawfully took the gas.

The fuel supplier says it has yet to receive payment.

Syed Kazmi was hit with a $380,000 judgment two years ago in a suit brought by 7-Eleven, the convenience chain, which accused him of “dishonest, unethical, immoral” conduct while operating a franchise in Lawrenceville, New Jersey, that was flagged for unsanitary conditions that included trash issues and a rodent infestation. The company also said “tens of thousands of dollars” of cigarettes ordered from 7-Eleven on credit had gone missing.

A federal judge held a company operated by Shamikh Kazmi in contempt in 2022 in a trademark case brought by BP America.

Though BP had severed ties with Kazmi’s Diwan Petrol two years prior to the legal action, the corporation’s signage had not been removed from the gas station despite a court order to do so. The judge authorized U.S. Marshals to accompany BP workers to remove it.

A man who answered a call to a number listed for the Kazmi brothers said he was not the right person to talk to and instead directed inquiries to the Freedom Fuel Network’s website. But that website has no contact information, phone number or mailing address. A request for comment submitted through an online contact form was not unanswered.

Company formed in a state known for opacity

Records from Delaware, a state known for offering incorporators a large degree of opacity, show the Freedom Fuel Network was registered on June 23. The document forming the company was signed by Randy Brown and Yoni Gontownik.

Politico and the website The Newsground reported that Brown is a senior special teams coach with the Baltimore Ravens. He has also served as the elected mayor of Evesham Township, a New Jersey suburb of Philadelphia, where a Freedom Fuel Network station is located.

Brown, a Republican, considered a run for Congress in 2021, telling a local newspaper he was a conservative and a “proud Trump supporter.”

Gontownik is a former investment director at Mercuria, a Swiss-owned commodities trading firm. He and his wife live in northern New Jersey and have been active with the pro-Israel political action committee NORPAC, including hosting fundraisers for Republican members of Congress.

Gontownik and Brown did not respond to requests for comment.

Experts say gas likely sold for a loss

Jeff Lenard, a spokesman for the National Association of Convenience Stores, said Freedom Fuel’s rock bottom promotional price meant the chain was likely selling the gas at a loss.

“It’s not unusual for retailers to have prices that are different than a market when they’re looking to make a splash,” said Lenard, whose association’s members account for most U.S. retail fuel sales, adding that such a splash typically lasts “a matter of hours or a matter of days.”

Social media posts and gas-price checking websites show that the per-gallon rate advertised at Freedom Fuel locations began creeping up this week.

A Freedom Fuel station in Bensalem, Pennsylvania, for example, on Thursday was selling regular gasoline for $3.82 a gallon. That was 27 cents cheaper than at a Sunoco station across the street.

The Freedom Fuel Network posted a note of thanks to its website this week, crediting Trump’s “strong endorsement” for the “explosive growth” of their business.

“Despite the misinformation and baseless speculation circulating,” the statement reads, “let us set the record straight: Freedom Fuel Network is proudly lowering its prices to benefit our community.”

It’s the first time that the national average has been at $4 or higher since June 17.

On Friday, U.S. crude oil settled at $82.49. International Brent crude oil closed at $88.10.

Gas prices had fallen in recent weeks to as low as $3.79 on July 7 and 8, but have trended higher again over the last two weeks as Washington and Tehran exchange daily attacks in a battle over the crucial Strait of Hormuz.

On Friday, oil prices posted their second straight weekly gain. Last week alone, U.S. crude oil and international Brent crude oil both rose more than 15%. Over the last two weeks, prices have risen more than 20%.

Oil prices began rising again after the U.S. revoked a sanctions waiver on Iranian oil on July 7. One day later, President Donald Trump announced that the ceasefire with Iran was “over.”

Days later, oil prices climbed after Trump announced that he was “reinstating the Iranian blockade” in the Strait of Hormuz. That blockade is “against vessels transiting to or from Iranian ports and coastal areas,” the U.S. military said this week.

Trump also said last week that the U.S. would seek to be “reimbursed, at the rate of 20% on all cargo shipped.” Shipping companies and international maritime organizations quickly rejected the idea as a violation of international law.

But the uncertainty continued. Although Trump said he would drop the fee, oil continued rising on near daily U.S. strikes against Iran as well as Iranian retaliation.

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It all centers on the struggle for control over the Strait of Hormuz, the waterway through which 20% of the world’s energy supplies typically transit on their way to global markets.

“Rather than pursuing full closure, Tehran appears intent on establishing authority over navigation itself through mandatory transit protocols and transit fees,” wrote JPMorgan Chase commodities analyst Natasha Kaneva on Thursday.

“The back-and-forth is hardening into a standoff over who controls the Strait, and has abruptly stalled the traffic recovery that began in early June,” Kaneva continued.

Last week, ship crossings in the strait dropped to a three-week low, according to data from MarineTraffic and Kpler.

On Thursday, just eight ships crossed the strait, a stark drop from the average of 130 ships that transited every day before the war started.

“Developments in the Russia-Ukraine war are playing more of a role recently too,” wrote HSBC commodities analysts.

“Russia, the world’s second-largest exporter of diesel after the U.S., banned exports of key refined products on 8 July, until end-July, as a growing share of Russian refining capacity has been knocked out amid escalating attacks on its energy infrastructure by Ukraine,” HSBC’s analysts wrote. “This is on top of existing restrictions on most shipments of gasoline and jet fuel.”

Since the start of the year, U.S. crude and Brent oil prices have now risen about 45%.

“At the same time, Russia is also now looking to import diesel itself; so there is less supply, and more demand in the global market,” they added.

Jet fuel prices are also rising again.

Before the Iran war, jet fuel averaged $2.50 per gallon. As of Friday, that price was nearly 43% higher, at $3.57 per gallon, according to data from the Argus US Jet Fuel Index.

Trump did not name any companies in his late-night message on TruthSocial, which was posted shortly after midnight.

“The big Oil Companies are not dropping their price at the pump commensurate with the sharply lower prices they are paying for Oil,” Trump wrote. “Those prices are dropping like a rock! In other words, customers are being ‘gouged.’ I have instructed the DOJ to immediately start looking into this. Gasoline prices better start going down a lot faster than what I’m seeing!” he added.

The Department of Justice did not respond to an overnight request for comment.

Trump’s war in Iran and Tehran’s subsequent closure of the Strait of Hormuz rocked global markets and sent energy prices soaring, resulting in higher gas prices for Americans at the pump.

That has translated into concerns that consumers may punish Republicans in November’s midterm elections.

But prices have eased in recent weeks amid peace talks, and more relief followed the news of an interim deal that would include reopening the crucial waterway, through which one-fifth of global oil supply is moved.

Gas prices in the U.S. fell last week below $4 per gallon for the first time since March, bringing a measure of relief to consumers.

Oil prices fell more than 1% on Wednesday, extending this week’s losses to trade near four-month lows on signs that more stranded oil tankers were set to move out of the Strait of Hormuz.

U.S. crude closed at $73.21 Tuesday, just $6.19 higher than the day before the U.S. struck Iran. That’s a drop of more than 36% since their peak in April.

The national average gas price meanwhile hovered at $3.93, according to the AAA tracker, compared to the $4.52 average a month ago. That’s a drop of around 13%.

But that’s still much higher than the national average price a year ago, which stood at $3.22, according to AAA.

Increased gas prices have resulted in higher monthly expenses for Americans — anywhere from less than $20 to more than $300 for a driver who fills up twice a month, according to an NBC News analysis of AAA’s average national gas price data.

Trump sought to reassure voters at a key Pennsylvania swing district on Tuesday that costs are coming down and that they are better off than they were two years ago.

Despite the relative reprieve at the pump, there is still uncertainty about whether the interim agreement will hold and traffic will continue to flow through the key trade route as the parties continue to negotiate the final agreement to settle the thorniest issues, such as Iran’s nuclear program.

The U.S. and Iran were in dispute Tuesday over whether Tehran had agreed to allow U.N. inspections of its nuclear sites.

Reuters contributed.

It will likely take months before energy companies can resume operations to the point of meeting the world’s demand, according to energy experts. The slow pace of the process of shipping and refining crude oil, and doubts about the security of traveling through the strait mean the effect won’t be seen immediately, they said.

Ships loaded with crude oil have been stranded in the Persian Gulf for more than three months, unable to safely travel through the waterway, through which about a fifth of the world’s oil and gasoline supplies typically traveled before the war began.

“It’s going to take time for people to feel comfortable and for insurance to be in place … particularly to get people on the ground to restart some of these assets,” said Daniel Evans, global head of fuels and refining research at S&P Global Energy.

Still, oil prices slipped early Monday after the deal was announced.

Brent crude, the international standard, was down $3.45 at $83.89 per barrel. U.S. benchmark crude oil lost $4.03 to $80.85 per barrel.

Those prices are still well above the roughly $70 per barrel where oil was trading before the war started.

As the higher prices unwind, ships that have been stranded will have to exit the strait, and then new tankers will have to come in to be loaded, Evans said.

“To bring a ship in, you need to be confident that you’ve got a big enough window of safety to bring it in, load it and move it out,” he added.

Oil tankers also move slowly, he explained. It takes months to travel from the strait to distant countries, deliver the crude oil to a refinery for processing and then arrive at its final destination.

War with Iran Jun 14

U.S. and Iran reach framework deal to end war and reopen the Strait of Hormuz

War with Iran Jun 9

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War with Iran Jun 9

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In addition, some producers in the Middle East paused extracting oil from the ground, known as a shut-in, when they ran out of storage space. Restarting those operations can be a slow process.

Countries such as Saudi Arabia and United Arab Emirates, where there are alternate pipelines or routes besides the Strait of Hormuz to deliver oil, may be among the quickest to resume production, said Alan Gelder, senior vice president of refining, chemicals and oil markets at Wood Mackenzie, an analytics firm.

“But places like Iraq could be much more challenged because they’ve had a much bigger shut-in, their fields are more difficult … it may well take about a year before they get back,” he said.

Investment in the energy system, which can take years to see the results, ground to a halt after the strait’s closure, Gelder said. So it will take time for this capital to restart.

Countries that shut in oil production won’t want to restart until they know there is a stable, durable strait, and that a ceasefire will last more than 30 or 60 days, said Daniel Sternoff, senior fellow at the Center on Global Energy Policy at Columbia University.

“We don’t know what open means or what the speed of evacuation of trapped material is going to be,” he said.

The behavior changes observed so far are subtle, such as altered routines for buying gasoline and fewer visits to clothing and furniture stores. They also are uneven across the population. During recent earnings calls with analysts, executives from American mainstays like Walmart, McDonald’s and Dollar General cited overall shopper resilience as well as noticeable cutbacks by lower-income customers.

But the new signs of strain cited by major retailers as generous income tax refunds helped shore up their sales make some economists and analysts think they will see a wider retrenchment when the refunds are gone and consumers face the cumulative impact of more expensive gas and higher prices for food, clothing, insurance and other goods and services.

Trevor Chapman, a communications executive in West Hills, California, said that instead of going to a local independent gas station, he and his wife now plan their fuel stops around Costco stores with filling stations. The couple also is doing more online food shopping to avoid impulse buys, he said.

“Gas is a kind of catalyst,” Chapman said. “It trickles down into the entire budget. We’re trying to keep everything as normal as possible. But it’s starting to feel like it’s adding up more and more.”

Well before the U.S. and Israel launched the war, many consumers already were being more choosy with their discretionary purchases, fatigued by several years of stubborn inflation and tariffs on imported goods imposed last year.

The U.S. Commerce Department reported last week that higher prices, not more purchases, accounted for most of the growth in Americans’ spending in April, when a key inflation gauge reached the highest level since October 2023.

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Topping up instead of filling up

Members-only warehouse stores like Costco, Walmart’s Sam’s Club and BJ’s Wholesale Club have seen more traffic at their fuel pumps since the war began in late February, according to the companies. Fuel typically costs less at the wholesale clubs.

But many drivers are not filling their tanks up, Walmart Chief Financial Officer John David Rainey told analysts late last month. For the first time since 2022, Walmart customers and Sam’s Club members are buying an average of less than 10 gallons per trip, he said.

“That’s an indication of stress,” Rainey said.

Costco members also are making changes. They are visiting store gas stations more frequently to “top up in between what would have normally been a gap between getting the tank to empty because of the concern about what might the gas price be tomorrow,” Chief Financial Officer Gary Millerchip said in late May.

Meanwhile, the gas price surge has hurt convenience stores, where 80% of all fuel is sold in the U.S., according to Jeff Lenard, a vice president at the National Association of Convenience Stores.

A sales analysis by the trade group found that the number of pump transactions at the properties of 130 convenience store companies fell by nearly 10% across March and April compared to the same two months last year. The number of sales inside the companies’ stores dropped by 10.4%, according to the analysis.

“When you lose gallons to the big box, you also lose in-store sales,” Lenard said.

Changing eating habits

Higher gas prices did not stop many Americans from dining out in the first two months of the war with Iran. Tax refunds helped, the National Restaurant Association said. Customer traffic at U.S. restaurants in April was unchanged from the same month last year, although a 2.6% increase in restaurant spending resulted largely from higher menu prices, according to market research firm Circana.

But cracks are starting to form as budget-conscious U.S. residents shoulder the combined weight of paying more for gas and other consumer goods on top of increasing costs in other areas from inflation past and present.

The price of gas won’t help bring customers with household incomes of $45,000 or less back to U.S. fast-food restaurants, McDonald’s Chairman and CEO Chris Kempczinski said last month. People in that income group began scaling back their fast-food purchases after the period of inflation that accompanied the end of the COVID-19 pandemic, and the trend picked up speed last year.

U.S.-based restaurant consulting firm Revenue Management Solutions analyzed 14.6 billion restaurant transactions from the last ‌four years ⁠and found that as gasoline gets more expensive, restaurant visits gradually decline, according to Chief Research Officer Sebastián Fernandez. The analysis indicated the impact doubles when gas hits the $4 mark, which it did as a nationwide average on March 31.

Consumers also are making concessions when they shop for groceries, according to Stew Leonard, president of an eight-store supermarket chain his father founded, Stew Leonard’s. He’s noticed customers buying meat in bulk to freeze and being less tempted to buy the products showcased during live food demonstrations or offered for sampling.

“It’s telling me that people are sticking more to their shopping list,” Leonard said.

Dollar General CEO Todd Vasos also cited $4 a gallon gas as a tipping point that had more consumers with household incomes above $100,000 frequenting the discount chain. Vasos told analysts Tuesday that many of Dollar General’s core shoppers, who have mid-to-low incomes and live in rural areas, were paring back their food spending.

Sophie Tolsdorf, 29, of La Grange, Kentucky, said she is one of the consumers stocking up on meat when the price is reasonable. She also switched to buying whole fruit instead pre-cut fruit in containers and cut back on the rawhide bones for her dog that cost $40 a pack.

“He might have noticed,” Tolsdorf said. “He’s definitely a little bit bored during the workday now.”

Needs versus wants

Before the war, retailers had spent multiple earnings seasons highlighting consumer caution and selectivity as factors that could weigh on sales of nonessential products. Shoppers appear to have curbed their discretionary spending even more as the cost of buying gas went up, said Marshal Cohen, chief retail advisor at Circana.

Between April 25 and May 23, U.S. retailers sold 6% fewer non-grocery products than they did during the comparable four-week period of 2025, Cohen said. Housewares, clothing, footwear and sports equipment had the biggest declines, anywhere from 5% to 7%. Circana reported that toys and beauty items remained bright spots, registering at least an 8% increase in the number of units sold.

Location intelligence company Placer.ai, which tracks people’s movements based on cellphone usage, saw visits to the gas stations of BJ’s, Costco and Sam’s Club stores start to accelerate in early March, aligning with a sharp rise in fuel prices, according to R.J. Hottovy, the company’s head of analytical research.

By early May, Placer.ai’s data showed four consecutive weeks of reduced foot traffic at clothing, electronics and home furnishing stores, and more trips to grocery stores and dollar stores.

“Consumers are prioritizing value-oriented retailers like warehouse clubs, superstores, and off-price chains,” Hottovy said.

___

AP Food Writer Dee-Ann Durbin in Detroit contributed to the report.

Conflicting comments from President Donald Trump hours later did little to dent oil’s jump, although prices ended the day somewhat lower than the highs of the morning.

U.S. crude oil closed higher by 5.5% at $92.16 per barrel. International Brent crude closed higher by 4.5% at $94.98 per barrel.

Heating oil, a proxy for jet fuel, also rose 4%, while wholesale gas prices rose 2%.

As a result of of the most recent decline in oil prices, the cost of retail gasoline was down 24 cents on Monday from this year’s peak. Still, gas prices remain higher by 44% on average than they were before the war.

Government bond yields, which heavily influence consumer borrowing rates, also rose slightly alongside energy prices.

The 10- and 30-year Treasury yields rose to the highs of the day after the report out of Iran, but later fell to near earlier levels. Yields on shorter-term bonds such as the two- and five-year Treasuries, however, held on to most of their gains through the afternoon.

Monday’s market moves essentially put oil prices back to levels from mid-May, before they saw two weeks of declines as administration officials continued to suggest that some kind of deal with Iran to end the war was within reach.

Now, as the war enters its fourth month, Tehran is reportedly suspending talks and “the exchange of texts through mediators” to protest Israel’s expanding offensive in Lebanon.

Iran also said it was “determined to consider the complete closure of the Strait of Hormuz and the activation of other fronts including the Bab el Mandeb Strait,” a critical commercial waterway off the coast of Yemen.

In response, Trump told NBC News that the U.S. will keep its blockade on Iranian ports. “If they don’t want to talk, that’s OK with me,” he said.

In a separate comment to CNBC, Trump said he was not concerned about oil prices that continue to rise. “I think the oil will be dropping like a rock in the very near, you know, the very near distance,” he said.

Shortly after giving both of those interviews Trump posted on social media, “Talks are continuing, at a rapid pace, with the Islamic Republic of Iran.”

NBC News has not independently confirmed the Iranian report, nor Trump‘s claim Monday afternoon that talks were proceeding.

Investors on edge

“The (largely) closed Strait of Hormuz remains the focus for commodity market observers,” HSBC strategists said in a note Monday morning.

“Commodity markets have, so far, absorbed the shock better than some of the worst-case scenarios, reflecting high inventories before the conflict and rapid shifts to redirect commodity trade,” they added.

“However, the longer the Strait of Hormuz remains closed, the more stocks will be run down and at some point they may reach critical functional lows, which could see sharper (non-linear) price rises and genuine shortages,” they said.

For most of May, daily ship traffic through the Strait of Hormuz remained the single digits, according to data from S&P Global Market Intelligence.

U.S. stocks also fell initially after the latest headlines about the Iran war, but declines reversed in the afternoon after Trump’s comments. Indexes were also buoyed by renewed momentum in AI stocks, following a series of product announcements from Nvidia overnight.

The Russell 2000 index, which tracks smaller companies and whose largest constituent is worth only $70 billion, struggled to turn positive throughout the day.

The disparity between more mainstream indexes, such as the S&P 500 and Nasdaq composite, and the Russell 2000 illustrates the bifurcation in markets between the indexes that are buoyed by large, AI-fueled companies and those that aren’t.

Internationally, stocks saw more widespread selling Monday, with benchmark indexes in Germany, France, the U.K. and Italy closing lower by around 0.5% The pan-European Stoxx 600 fell 0.8%. 

“It’s a small percentage, but it’s still money,” he said.

Suspending the federal gas tax, which currently sits at about 18 cents per gallon, would require congressional approval.

Earlier Monday, Trump told CBS News in a phone interview that he thought suspending the gas tax was “a great idea.”

“We’re going to take off the gas tax for a period of time, and when gas goes down, we’ll let it phase back in,” he added.

Trump’s remarks came a day after Energy Secretary Chris Wright said during an interview on NBC News’ “Meet the Press” that Trump was “open to all ideas” to cut the cost of gas, including potentially pausing the federal gas tax.

Democrats introduced legislation in March to suspend the federal gas tax until October, but their proposal has stalled. Sen. Josh Hawley, R-Mo., said in a Monday post to X that he was “introducing legislation today to suspend the gas tax.” Rep. Anna Paulina Luna, R-Fla., also said in a post to X that she would introduce a House bill “to suspend the federal gas tax in light of Trump’s recent remarks.” It was not immediately clear whether or how their legislation would differ from what the Democrats proposed.

“American families need this relief on gas prices,” she wrote. “My office will be working directly with President Trump to ensure we deliver this win for the American people.”

Rep. Chris Pappas, D-N.H., and Sen. Mark Kelly, D-Ariz., spearheaded the March bill. Pappas responded to Trump’s support for suspending the gas tax by saying in a post to X, “This should have happened months ago.”

“Let’s pass it this week,” he said in the post.

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The federal gas tax helps fund the Highway Trust Fund, which supports highway and mass transit programs, according to the Tax Policy Center. A five-month suspension of the tax could ultimately cost the government billions in revenue used for the fund this fiscal year, according to the Bipartisan Policy Center.

But even if the federal gas tax were suspended, gas prices would likely not decrease by the full 18 cents per gallon. The Bipartisan Policy Center estimated that gas would likely fall by 10 to 16 cents per gallon for consumers, while gasoline suppliers would get the rest of the benefit.

Gas prices have risen more than 50% since the start of the war in Iran. On Monday, the national gas price average stood at $4.52 per gallon.

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The Los Angeles County average rose 3.7 cent overnight to $6.141, the highest since Oct. 5, 2023. One week ago, the average price was $5.98. The average was $6.007 a month ago.

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Since the U.S.-Israel attack on Iran Feb. 28, the average for a gallon of regular has climbed $1.44.

LA County’s record high is $6.494 set on Oct. 5, 2022.

Los Angeles is one of about two dozen California counties with average gas prices topping $6. The statewide average Friday morning was at $6.06, up from Thursday’s average of $6.01 and the average one week ago of $5.88.

The Orange County average price rose 4.7 cents to $6.116, its highest amount since Oct. 3, 2023. It has increased 10 consecutive days, rising 26.9 cents, including 2.3 cents Thursday. The Orange County average price is 17.8 cents more than one week ago, 17.6 cents higher than one month ago and $1.403
above what it was one year ago.

Retail prices for regular gasoline are typically higher in California than national averages and prices in other states due to factors that include taxes and fees, and environmental and fuel requirements.

“California’s gasoline supply is significantly affected by the Strait of Hormuz closure,” Kandace Redd, the Automobile Club of Southern California’s senior public affairs specialist, said in a statement released Thursday.

The national average price rose 9.2 cents to $4.392, its highest amount since July 22, 2022. It has risen nine consecutive days, increasing 37.2 cents, including 7.1 cents Thursday.

Below, some fuel saving tips.

Start by checking your car’s tires

It’s something drivers should do regularly anyway — after all, that’s where the rubber meets the road. Beyond making safety sense, properly inflated tires can help save fuel. A low tire increases the amount of fuel used. Look on the inside of your car’s door panel to find the correct PSI. Modern passenger cars usually have a PSI in the 30s.

Avoid the restaurant drive-thru line

The fast-food drive-thru might sound quick and easy, but you’re burning fuel while you wait. If your car is stopped for more than 60 seconds, shut off the engine, AAA recommends. Many new cars come with automatic start-stop to do the job for you.

Not so fast. It’s a major drag

Again, safety should be motivation enough to travel at sensible speeds. But it can also help save fuel. On freeways, aerodynamic drag causes fuel economy to drop off as speeds increase above 50 mph, AAA says. 

Smooth and steady wins the fuel savings race

Think smooth and steady at the stop light. Unless you’re on a Formula 1 grid, hard acceleration when the light turns is a bad idea, especially for fuel economy. Smooth acceleration allows an automatic transmission to upshift sooner, lowering engine RPM and saving gas. If you have a manual transmission, upshift as soon as you can without ‘lugging’ the engine. 

Easy does it when stopping

There’s no need to hurry up and wait, so AAA recommends taking your foot off the gas early and allowing the car to gradually and safely coast to a slower speed until its time to brake for a stop sign or stop light. 

Cruising helps avoid a bruising at the pump

Using cruise control will help you maintain a constant speed instead of regularly slowing down and speeding up on the freeway. Just don’t use it on slippery roads.  

Stash the roof rack

Try to limit your use of roof racks and other carriers. On the highway, an empty bike, canoe or ski rack can hurt fuel economy. 

Cool it without the air conditioning

AAA says it’s best to minimize your use of air conditioning. Open windows have less impact on fuel economy than the engine power required to run the air conditioning compressor, even at highway speeds. 

Stop trippin’

Try to pack as many errands as possible into one trip from home instead of making multiple trips. All that driving around is wasting gas.

Premium v. regular gas

The recommendations above are all things drivers can do on the road, but there’s one thing AAA recommends at the fuel pump. The agency says its research shows that unless your vehicle’s manufacturer specifically recommends more expensive premium fuel, it provides no added benefit over less expensive regular. So, check your car’s manual or the inside of the gas tank lid. 

According to a study by the UCLA Latino Policy & Politics Institute, the spiking gas prices are disproportionately affecting the financial health of Latino households largely because they tend to have fewer financial resources and depend on cars for their livelihoods.

Based on a number of data sources, including the 2023 Consumer Expenditure Survey and 2017 National Household Travel Survey, the researchers calculated the average amount of Latino families’ year budget compared to non-Latino households. They also measured households’ dependency on vehicles and the distance.

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When Latino households spend more on gas, it’ll eat up more of their budgets, even when they don’t have other means to make up for the difference.

“Latino households spend $1,300 more per year on gasoline than non-Latino households,” the study said. “These higher housing costs leave Latino households with less room in their budget to absorb rising gasoline costs.”

The reason for higher gas expenditure is Latino families tend to commute more than other ethnic groups. They are also less likely to work from home, the researchers said.

“Even before the gas prices increased Latinos households were already spending more money on gas than non-Latinos and always experiencing higher costs of house burden,” Rosario Majano with the UCLA Latino Policy & Politics Institute told NBCLA.

Also because Latino households are less likely to have newer, more fuel-efficient cars, they are spending more on fuel without alternative options, the study found.

Abel Martinez, who is juggling multiple jobs while scaling back on going out, said he understands why Latinos are spending more on gas.

“If you think about it many electric cars are on the pricier side,” Majano said. “Many Latinos are on the lower income so many don’t have the opportunity to buy things like that. “

Researchers said they hope the data can be a tool for policy makers to find ways to support all communities, especially Latinos who are struggling financially but contribute to the state.

As of Thursday, the average price of a gallon of regular gas in Los Angeles County rose was $5.95 per gallon, $5.08 in Orange County.

U.S. crude oil jumped more than 7%, to about $90 per barrel, and international Brent crude oil rose 5%, to around $95 per barrel.

S&P 500 futures dropped nearly 0.8%, Nasdaq 100 futures fell 0.7%, and Dow futures tumbled 500 points, or 0.7%. Russell 2000 futures slid 1.4%.

Wholesale gas prices also rose by more than 4%, and heating oil futures, which are a proxy for jet fuel prices, also spiked 7%. Natural gas prices rose 2%.

The moves adds to weeks of dramatic ups and downs as investors have tried to digest the almost daily swings between war and peace. While major U.S. stock indexes had recently recovered all loses incurred since the war began, oil prices have remained elevated, costing consumers more at the gas pump and pushing inflation higher.

Of particular concern is the Strait of Hormuz, the crucial waterway off Iran, where more than 20% of the world’s oil supply normally passes.

Iran declared the strait open for commercial vessels Friday — which sent oil prices plummeting 11% — but then walked back the statement over the weekend as it accused the U.S. of only “partially implementing the ceasefire.”

Iran declared the strait closed again, and dozens of commercial ships that tried to exit the strait turned back around and remain trapped west of the crucial passage.

Shipping giant CMA CGM said one of its ships came under fire Saturday. “CMA CGM confirms that one of its vessels was the subject of warning shots yesterday,” a spokesperson told NBC News on Sunday. “The crew is safe and unharmed.”

President Donald Trump also said Iran had attacked ships.

“Iran decided to fire bullets yesterday in the Strait of Hormuz — A Total Violation of our Ceasefire Agreement,” Trump wrote Sunday morning on Truth Social. “Many of them were aimed at a French Ship, and a Freighter from the United Kingdom.”

Escalating tensions even further, Trump later said the U.S. military had “blown a hole” in the engine room of an Iranian ship that “tried to get past our Naval Blockade.”

“Right now, U.S. Marines have custody of the vessel,” he said.

U.S. Central Command published video of shots being fired at the vessel from a U.S. Navy guided missile destroyer and added that Marines have boarded the vessel.

“Iran will soon respond to this act of armed piracy and theft by the America military and will retaliate,” a spokesperson for Iran’s armed forces said on state TV.

No commercial ships were recorded crossing the strait Sunday as the latest developments played out, according to data from the maritime tracking firm Kpler.

Traders were also closely watching the status of peace talks between the U.S. and Iran, which Trump said Sunday morning were set to take place in Islamabad.

“My Representatives are going to Islamabad, Pakistan — They will be there tomorrow evening, for Negotiations,” he said.

But later, Iranian state media said that “the reports published about a second round of negotiations in Islamabad are not true.” As of Sunday night, further details remained unclear.

The average price of a gallon of diesel Thursday in California was $7.559, an all-time high that eclipsed the previous mark Wednesday of $7.522. One week ago, the average for a gallon of diesel was $7.120.

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One month ago, it was at $5.100.

In Los Angeles County, diesel was at an all-time high of $7.684 on Thursday, up from $7.646 Wednesday and $7.232 on week ago. One month ago, the average price for diesel was $5.110.

The average in Riverside County was $7.66 and $7.57 in Ventura County.

The average U.S. price for a gallon of diesel to start the week was at $5.401, up by $1.809 from a year ago.

Long-haul truckers are some of the first to take a hit when prices soar for the price of diesel, the fuel used for many freight and delivery trucks. At some point, soaring diesel prices could have a trickle-down effect, according to experts.

“That’s about to really hit consumers in Southern California,” said UCLA Prof. Michael Ross, who studies the intersection between politics and fossil fuels. “Especially for things that are perishable.

“Like fresh vegetables that come in from the Central Valley that have to be refrigerated the whole journey. Or, meat that needs to come in from other parts of California… It has to make a long journey. It has to be in a refrigerated truck. All of that takes diesel fuel.”

Ross noted that some short-haul trucking, such as transports from the ports of Long Beach and Los Angeles, are carried out by electric trucks.

“It’s longer haul stuff where we’re going to see the biggest impact,” he said.

Since the U.S. and Israel launched a joint war against Iran on Feb. 28, the cost of crude oil — the main ingredient in gasoline — has spiked and swung rapidly. That’s because the conflict has caused deep supply chain disruptions and cuts from major oil producers across the Middle East.

Oil prices surged Thursday a day after President Trump delivered an address to nation about the Iran war. Trump said the war would end “shortly,” but also promised additional “extremely hard” strikes on Iran “over the next two to three weeks.”

Global crude oil prices directly affect the price of fuel in the U.S.

Retail prices for regular gasoline are typically higher in California than national averages and prices in other states due to factors that include taxes and fees, and environmental and fuel requirements.

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As of Friday, the average price of a gallon of self-serve regular gasoline in Los Angeles County was $6.002 while it’s $5.926 in Orange County.

But $6 a gallon may not seem much compared to what people driving through Big Sur have to pay: Gorda-by-the-Sea Mini Mart along the Big Sur coast is selling premium gas for $10 per gallon.

Technically, it’s $9.99, but the owner of the gas station/mini mart doesn’t have much choice as the price display only allowed three digits.

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“That’s insane. I just saw it right now, and I couldn’t believe it. It’s not something I’m used to,” Gustavo Fraga, traveling north from Los Angeles, told our affiliate KSBW. “Over there in LA, we’re at about, like, $6 max, which is something that hits everyone like crazy. But here it’s $10. I’ve never seen that, ever.”

The Gorda-by-the-Sea gas station often has the highest gas price in the country, but the owner, Leo Flores, said he needs to charge more because it costs more to run a gas station on the coastline.

“We run the place on generators. We don’t have power,” Flores said. “We create our own power here.”

Another reason for the high prices is transportation: Flores said he has to haul gas from Fresno, over $100 miles away.

Despite the jaw-dropping prices, drivers often have no choice: whether they are driving toward Los Angeles or San Francisco, when you need gas, your choices are limited.

“They probably could charge $20 a gallon, and if you have to get gas, you have to get gas,” Debbie Carignan, traveling from Southern California, told KSBW.

In Los Angeles County, the average price of a gallon of self-serve regular gasoline on Tuesday reached $6 for the first time since Oct. 8, 2023. The record high for the county was $6.494 in October 2022.

The average price in LA County has increased 40 of the last 41 days, including seven-tenths of a cent on Monday. The average price is 7.2 cents more than one week ago, $1.311 higher than one month ago and $1.186 greater than one year ago.

Diesel fuel hit all-time highs at $7.455 in California and $7.592 in Los Angeles County.

The statewide average in California was $5.887, up from $4.643 one week ago and $4.809 from a year ago. Several other California counties eclipsed the $6 average, including Inyo ($6.076), Mono ($6.675), Humboldt ($6.247), Sonoma ($6.035), Marin ($6.069) and San Mateo ($6.034).

Retail prices for regular gasoline are typically higher in California than national averages and prices in other states due to factors that include taxes and fees, and environmental and fuel requirements.

According to motor club AAA, the national average for a gallon of regular gasoline is now $4.02 — over a dollar more than before the war began. The last time U.S. drivers were collectively paying this much at the pump was nearly four years ago, following Russia’s invasion of Ukraine.

The price is a national average, meaning drivers in some states — like California, Illinois, Nevada and Arizona — have been paying well over $4 a gallon for a while now. Prices vary from state to state due to factors ranging from nearby supply to differing tax rates.

Since the U.S. and Israel launched a joint war against Iran on Feb. 28, the cost of crude oil — the main ingredient in gasoline — has spiked and swung rapidly. That’s because the conflict has caused deep supply chain disruptions and cuts from major oil producers across the Middle East.

Expensive gas could drag on the economy and drive up other prices

Higher gas prices are impacting consumers and businesses as many households continue to face wider cost of living strains. And as drivers pay more to cover necessities like gas, many may be forced to cut their budgets in other places.

More expensive fuel can also push up other spending, from utility bills to the price of many goods consumers buy each day.

Consumer prices and the cost of living already have become flashpoints in this midterm election year, with Democrats especially hammering Trump and Republicans as the GOP tries to hold majorities on Capitol Hill. A recent AP-NORC poll found that 45% of U.S. adults are “extremely” or “very” concerned about being able to afford gas in the next few months, up from 30% shortly after Trump won the 2024 presidential election with promises to lower costs.

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In the immediate future, analysts point to groceries, which have to be restocked frequently and could also see price hikes as businesses’ transportation costs pile up.

But hauling other cargo and packages has also been impacted. The United Postal Service, for example, is seeking a temporary 8% added charge on some of its popular products including Priority Mail.

U.S. diesel prices — the fuel used for many freight and delivery trucks — is now going for an average of $5.45 a gallon, up from about $3.76 a gallon before the war began, per AAA. In California, diesel soared to $7.45 a gallon from $5.10 a month ago.

If the war drags on, it’s possible that those prices could tick up even higher. Most tanker movement in the key Strait of Hormuz, where roughly one-fifth of the world’s oil typically sails through, remains at a halt. That’s led to cuts from major producers in the region who have no way of getting their crude to market. Meanwhile, Iran, Israel and the U.S. have all struck oil and gas facilities, worsening supply concerns.

Reserves open in an effort to cut prices

In a search for some relief, the International Energy Agency pledged to release 400 million barrels of oil from emergency stockpiles of member nations. That includes the U.S., despite Trump initially downplaying the need for reserve oil.

The Trump administration has also eased sanctions to free up some oil from Venezuela, and temporarily Russia. The White House also says it’s waiving maritime shipping requirements under a more than century-old law, known as the Jones Act, for 60 days.

It’s not yet clear if those efforts will bring relief for consumers. A lot of factors contribute to gas prices.

Refineries buy crude oil in advance, meaning some could be work with more expensive oil for a while, and it will take time for any new supply to trickle down to consumers.

And while steep crude prices are a leading driver behind today’s surge, U.S. gas prices typically tick up a bit at this time of year. More drivers are hitting the road and trying to fuel up while they can, so there’s higher demand. Warming weather also brings a shift to summer blend fuel, which is more expensive to produce than winter blend.

The U.S. is an oil exporter, but it’s still affected by global prices

The U.S., which is a net oil exporter, hasn’t seen as stark a shock as other parts of the world that rely more heavily on fuel imports from the Middle East, notably Asia. But that doesn’t mean America is immune to price spikes.

Oil is a globally-traded commodity. And most of what the U.S. produces is light, sweet crude — but refineries on the East and West coasts are primarily designed to process heavier, sour product. As a result, the country also needs imports.

Escalating geopolitical conflicts have disrupted oil flows and contributed to a surge in gas prices in the past. The U.S. average for regular gasoline climbed to its highest level of more than $5 a gallon in June 2022, nearly four months after the Ukraine war began and world leaders imposed sanctions against Russia, a leading oil producer.

Prices at the pump later fell from that record. Before Tuesday, per AAA data, the national average had stayed below the $4 mark since mid-August of 2022.

___

Associated Press journalists Angela Charlton in Paris and Bill Barrow in Washington contributed to this report.

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Lawmakers say the action would provide much-needed relief for families and businesses that rely on their cars and trucks to get to work and school and run everyday errands.

Asked about the gas tax at a Cabinet meeting Thursday, President Donald Trump said he has “thought about” suspending it but suggested states should consider suspending their fuel taxes.

“People have talked about” a gas tax suspension, Trump said. “It’s something we have in our pocket if we think it’s necessary.”

As gas prices have spiked, the Trump administration has released millions of barrels of oil from the U.S. Strategic Petroleum Reserve and temporarily lifted sanctions on some Russian and Iranian oil shipments already at sea. The U.S. is negotiating with countries reliant on Middle East crude to join a coalition to police the Strait of Hormuz, where about one-fifth of the world’s traded oil normally flows.

Here’s a look at what a gas tax holiday is and its potential impacts.

What is a gas tax holiday?

A gas tax holiday is a temporary suspension of the federal gas tax, currently set at 18.4 cents per gallon on gasoline and 24.4 cents per gallon on diesel fuel.

The tax provides more than $23 billion per year in revenue for federal highway and public transit programs.

The president cannot suspend the federal tax on his own. Congress would have to approve the move.

Both the House and Senate are controlled by Republicans, and bills on the issue are unlikely to advance unless Trump signals his support.

Suspending the tax could provide some relief

Rising gas prices are putting renewed pressure on household finances, especially for low- and middle-income Americans who have less flexibility to absorb higher transportation costs. The increases can influence how much people drive, where they travel and how they spend money on other things.

“Trump’s war of choice with Iran is driving up gas prices across the country — and Americans shouldn’t have to bear the additional economic burden of Trump’s reckless decision making,” said Sen. Richard Blumenthal, a Connecticut Democrat who co-sponsored the Gas Prices Relief Act with fellow Democratic Sen. Mark Kelly of Arizona.

The bill would suspend the tax through Oct. 1. A similar measure was sponsored in the House by Democratic Rep. Chris Pappas of New Hampshire.

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There are drawbacks, industry group says

The gasoline tax is the single largest source of revenue for federal highway and public transit programs.

While the House and Senate bills would offset any lost Highway Trust Fund revenue with general funds, the tax suspension could raise the federal deficit and jeopardize the long-term sustainability of investments for highway and public transit programs, according to the American Road & Transportation Builders Association, which represents the transportation construction industry.

The group cites studies showing that many retailers do not pass on the full amount of the gas tax reduction to consumers. Research also suggests that state and federal gas taxes are just one component of a complex pricing scheme that includes the global price of oil and other factors, the group said.

States are considering their own gas tax breaks

Some states are taking action to lower the gas tax. Georgia Republican Gov. Brian Kemp on March 20 signed into law a 60-day suspension of the state’s 33-cents-per-gallon tax on gas and 37-cents-per-gallon tax on diesel.

The law was supported by both Republicans and Democrats. Kemp said he wanted to “return taxpayer money where it belongs, in the pockets of hardworking Georgians.”

Early results are positive for Georgia drivers. It takes a few days or more for the tax holiday to trickle through to pump prices, because wholesalers pay fuel taxes in the state. But while gas prices nationwide went up an average of 10 cents per gallon in the week that ended Thursday, they fell 15 cents a gallon in Georgia, according to motorist group AAA. On Friday, the state had the 13th-lowest average gas price among states at $3.60 per gallon. Kansas was the lowest at $3.27.

Several states — including California, Connecticut, Florida, Maryland and Utah — have weighed gas tax holidays as a way to provide relief at the pump.

Connecticut Democratic Gov. Ned Lamont recently suggested a temporary suspension of the state’s 25-cent-per-gallon tax on gasoline and 48.9-cent diesel tax, but it remains unclear whether it will happen. State officials are also discussing possible rebate checks for taxpayers to help blunt high energy costs.

Florida Republican Gov. Ron DeSantis, who has supported past gas tax holidays, was skeptical that motorists would see real savings.

“Our ability to influence fuel prices are really marginal,” DeSantis said at a bill signing ceremony this month, according to Politico. “Sometimes the prices get raised so the consumer doesn’t see any difference. … I think when we did it in the past … I don’t think the consumer really felt relief.”

Driving habits can help reduce costs

The top advice for drivers looking to save at the pump is to obey the speed limit and drive smoothly, according to Consumer Reports. Driving habits can play a significant role in fuel economy, the magazine says.

Driving at a steady 55 mph can increase fuel economy by 6 to 8 mpg, the publication said in a report that offered tips to get the most out of a tank of gas. “Speeding up from 55 to 75 mph is like moving from a compact car to a large SUV,” the article said.

Beyond fuel concerns, speeding also is a safety risk. And drivers should avoid hard acceleration and braking whenever possible, and skip premium gas if their cars allow it, the magazine said.

___

Associated Press writers Jeff Amy in Atlanta and Susan Haigh in Hartford, Conn., contributed to this report.

The average price has increased 37 of the last 38 days, including two- tenths of a cent Friday, according to figures from the AAA and Oil Price Information Service. It is 17.3 cents more than one week ago, $1.277 more than one month ago and $1.26 more than one year ago. It is 52.3 cents less than the record $6.494 set on Oct. 5, 2022.

The Orange County average price rose 1.3 cents to $5.912, one day after a 56-day streak of increases ended with a decrease of four-tenths of a cent. The Orange County average price is the highest it’s been since Oct. 6,
2023, and is 14.4 cents more than one week ago, $1.276 more than one month ago and $1.239 more than one year ago. It is 54.7 cents less than the record $6.459 on Oct. 5, 2022.

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Prices were rising slightly in line with seasonal norms before the joint U.S./Israel attack on Iran on Feb. 28 sent oil prices higher and drastically accelerated increases at the gas pump.

“Southern California gas prices are following a similar pattern to the spike we saw after Russia invaded Ukraine on Feb. 24, 2022,” Kandace Redd, the Automobile Club of Southern California’s senior public affairs specialist,
said in a statement released Thursday.

“Today marks 27 days since the Iran conflict began, and the Los Angeles average gas price has risen by $1.26 a gallon since then. During the same number of days after the Russia-Ukraine war began, the Los Angeles average gas price rose by $1.19 a gallon to an average price of over $6 a gallon.”

The national average price dropped for the third consecutive day, decreasing two-tenths of a cent to $3.976, following a 25-day streak of increases that boosted it to its highest amount since Aug. 11, 2022. The national average price is 5.1 cents more than one week ago, 99.4 cents more than one month ago and 81.9 cents more than one year ago. It is $1.04 less than the record $5.016 set on June 14, 2022.

The average price Tuesday morning climbed by 3.8 cents, another in a series of recent increases, to $5.93. That’s the highest price since Oct. 10, 2023, according to AAA.

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The average price in LA County has increased 33 of the last 34 days, according to AAA. The price leaped by more than 30 cents from a week ago, $1.263 more than one month ago and $1.274 more than one year ago.

The highest-ever average price in Los Angeles County was $6.494 in October 2022.

The Orange County average price jumped 2.8 cents to $5.887, its highest amount since Oct. 6, 2023.

The price for a gallon of regular in California Tuesday was $5.822, up from $5.790 on Monday, $5.542 a week ago, $4.628 one month ago and $4.647 a year ago.

As of Tuesday morning, a gallon of regular topped $6 in four California counties, including Marin ($6.024), Sonoma ($6.001) and Humboldt ($6.067). Inyo County had the state’s highest average at $6.565, according to AAA.

The lowest average price was in Northern California’s Tehama County at $5.461.

The national average Tuesday was $3.977 per gallon.

Retail prices for regular gasoline are typically higher in California than national averages and prices in other states due to factors that include taxes and fees, and environmental and fuel requirements.

Use the form below to tell us about it and send us a photo of gas prices near you.

Below, some fuel saving tips.

Start by checking your car’s tires

It’s something drivers should do regularly anyway — after all, that’s where the rubber meets the road. Beyond making safety sense, properly inflated tires can help save fuel. A low tire increases the amount of fuel used. Look on the inside of your car’s door panel to find the correct PSI. Modern passenger cars usually have a PSI in the 30s.

Avoid the restaurant drive-thru line

The fast-food drive-thru might sound quick and easy, but you’re burning fuel while you wait. If your car is stopped for more than 60 seconds, shut off the engine, AAA recommends. Many new cars come with automatic start-stop to do the job for you.

Not so fast. It’s a major drag

Again, safety should be motivation enough to travel at sensible speeds. But it can also help save fuel. On freeways, aerodynamic drag causes fuel economy to drop off as speeds increase above 50 mph, AAA says. 

Smooth and steady wins the fuel savings race

Think smooth and steady at the stop light. Unless you’re on a Formula 1 grid, hard acceleration when the light turns is a bad idea, especially for fuel economy. Smooth acceleration allows an automatic transmission to upshift sooner, lowering engine RPM and saving gas. If you have a manual transmission, upshift as soon as you can without ‘lugging’ the engine. 

Easy does it when stopping

There’s no need to hurry up and wait, so AAA recommends taking your foot off the gas early and allowing the car to gradually and safely coast to a slower speed until its time to brake for a stop sign or stop light. 

Cruising helps avoid a bruising at the pump

Using cruise control will help you maintain a constant speed instead of regularly slowing down and speeding up on the freeway. Just don’t use it on slippery roads.  

Stash the roof rack

Try to limit your use of roof racks and other carriers. On the highway, an empty bike, canoe or ski rack can hurt fuel economy. 

Cool it without the air conditioning

AAA says it’s best to minimize your use of air conditioning. Open windows have less impact on fuel economy than the engine power required to run the air conditioning compressor, even at highway speeds. 

Stop trippin’

Try to pack as many errands as possible into one trip from home instead of making multiple trips. All that driving around is wasting gas.

Premium v. regular gas

The recommendations above are all things drivers can do on the road, but there’s one thing AAA recommends at the fuel pump. The agency says its research shows that unless your vehicle’s manufacturer specifically recommends more expensive premium fuel, it provides no added benefit over less expensive regular. So, check your car’s manual or the inside of the gas tank lid. 

The San Francisco-based delivery company announced the program Monday as the national average price for gas hit $3.96 per gallon in the U.S., according to AAA. That’s 35% higher than one month ago.

Global oil prices have soared since the Iran war began on Feb. 28. Last week, Brent crude oil, the international standard, briefly rose above $119 per barrel, up from roughly $70 before the war began.

Iran has halted most shipments of oil through the Strait of Hormuz and has also attacked oil and gas facilities around the Persian Gulf in response to an Israeli attack on an important Iranian natural gas field.

DoorDash said U.S. drivers with a DoorDash debit card will earn 10% cash back on any gas purchase, up from the usual rate of 2%. More than half of DoorDash drivers have the card, the company said.

The company said drivers who travel 125 miles or more while making deliveries will also receive a weekly fuel payment, starting at $5 and up to a maximum of $15.

In Canada, DoorDash drivers will receive up to $36 Canadian dollars per week based on the miles they travel to make deliveries.

DoorDash said both programs will remain in effect through April 26. It announced a similar gas price relief program in Australia late last week.

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It’s not yet clear if rivals will match DoorDash’s payments. GrubHub said last week that it is keeping a close eye on gas prices. Messages seeking comment were left Monday with Uber and Lyft.

DoorDash launched a similar temporary program in 2022 when U.S. gas prices topped $4 per gallon. At the time, Uber and Lyft also put in place temporary gas surcharges for customers.

The Treasury issued a broad authorization allowing Petróleos de Venezuela S.A., or PDVSA, to directly sell Venezuelan oil to U.S. companies and on global markets, a massive shift after Washington for years had largely blocked dealings with Venezuela’s government and its oil sector.

Separately, the White House said President Donald Trump would waive, for 60 days, Jones Act requirements for goods shipped between U.S. ports to be moved on U.S.-flagged vessels. The 1920s law, designed to protect the American shipbuilding sector, is often blamed for making gas more expensive.

The moves highlight the increased pressure that the Republican administration is under to ease soaring oil prices as the United States, along with Israel, wages war with Iran. Global oil prices have since spiked as Iran halted traffic through the narrow Strait of Hormuz, through which one-fifth of the world’s oil typically passes.

Drivers in the United States are paying the highest pump prices in about 2 1/2 years. The national average for a gallon of regular gasoline topped $3.84 on Wednesday, according to AAA, compared with $2.98 before the war began on Feb. 28.

Even before that, voters were worried about higher living costs, and fuel prices are now adding to concerns for Republicans heading into the election season with their control of Congress at stake in November.

“Gas prices are up and we know they’re up. And we know that people are hurting because of it. And we’re doing everything that we can to ensure that they stay lower,” Vice President JD Vance said at an event in Auburn Hills, Michigan. “This is a temporary blip.”

Easing sanctions could spur U.S. investment in Venezuela

The Treasury’s license is designed to incentivize investment in Venezuela’s energy sector and is intended to benefit both the U.S. and Venezuela, while increasing the global oil supply, a Treasury official told The Associated Press. The official was not authorized to discuss the matter publicly and spoke on condition of anonymity.

Since the ouster and arrest of Nicolás Maduro as Venezuela’s president during a U.S. military operation in January, Trump has said the U.S. would effectively “run” Venezuela and sell its oil.

The U.S. license provides targeted relief from sanctions, but does not lift the penalties altogether. The license allows companies that existed before Jan. 29, 2025, to buy Venezuelan oil and engage in transactions that would normally be banned under American sanctions.

But in the short term, there is not likely to be much impact on U.S. gas prices, said Geoff Ramsey, an expert on Latin America at the Atlantic Council think tank.

“We’re talking about 12 to 18 months before we see dramatic changes in Venezuelan output,” Ramsey said in an interview.

Easing sanctions and waiving Jones Act requirements normally would have significant impacts on gas prices, said Claudio Galimberti, Rystad Energy’s chief economist. “But we are in the most abnormal market I can remember,” Galimberti said in an interview.

He said he expects hostilities between the U.S., Israel and Iran to last at least two or three more weeks, and said prices are likely to be high and volatile until oil and gas traffic resumes through the Strait of Hormuz. “As long as the strait remains shut, we’re going to have a crisis,” Galimberti said.

Closer to home, Trump is waiving shipping restrictions

Gas prices in some parts of the country, such as the mid-Atlantic region, may see some relief from Trump’s waiver of the Jones Act, which will allow larger ships to move between U.S. ports, said Ramanan Krishnamoorti, vice president for energy and innovation at the University of Houston.

“Places like Texas and Chicago are unlikely to feel any change in the price of gasoline and diesel because of the Jones Act waiver,” Krishnamoorti said. He said some American shippers may now face more competition from the relaxation of shipping rules, which could mean higher costs for them.

White House press secretary Karoline Leavitt said the Jones Act waiver would help “mitigate the short-term disruptions to the oil market” during the Iran war and would “allow vital resources like oil, natural gas, fertilizer, and coal to flow freely to U.S. ports.”

Last week, Trump announced that he would tap the strategic petroleum reserve, part of a wider agreement with many of the world’s wealthiest countries to draw oil from emergency stockpiles.

The administration also eased sanctions on certain Russian oil shipments for 30 days. Next week, Vance and other administration officials are expected to meet with the main oil industry group, the American Petroleum Institute, to discuss energy markets and production, the group’s spokesperson Andrea Woods said.

The waiver of the Jones Act rules might only save consumers three or four cents per gallon, said David Goldwyn, a former Obama-era State Department special envoy focused on energy

“We’re talking about pennies, Goldwyn said.

All told, the administration’s market tweaks will create some “buffers” for price hikes, at least until late May, Goldwyn said. The big risk for consumers is if the Hormuz Strait remains closed beyond that point. “Then the shortfall will increase significantly,” he said.

Critics are worried about the impact of easing Venezuela sanctions

The Treasury license is expected to give a massive boost to Venezuela’s oil-dependent economy and help encourage companies that have been apprehensive to invest. There are some limits. Payments cannot go directly to sanctioned Venezuelan entities such as PDVSA, but must be sent instead to a special U.S.-controlled account. In other words, the U.S. will allow the oil trade but will control the cash flow.

Additionally, deals involving Russia, Iran, North Korea, Cuba and some Chinese entities will not be allowed. Transactions involving Venezuelan debt or bonds will not be allowed. The new license does not allow payments in gold or cryptocurrency, including the petro, which was a crypto token issued by the Venezuelan government in 2018.

Venezuela sits atop the world’s largest oil reserves and used them to power what was once Latin America’s strongest economy. But corruption, mismanagement and U.S. economic sanctions saw production steadily decline from the 3.5 million barrels per day pumped in 1999, when Maduro’s mentor, Hugo Chávez, took power, to less than 400,000 barrels per day in 2020.

A year earlier, the Treasury Department under the first Trump administration locked Venezuela out of world oil markets when it sanctioned PDVSA as part of a policy punishing Maduro’s government for corruption. That forced the government to sell its remaining oil output at a discount — about 40% below market prices — to buyers such as China. Venezuela even started accepting payments in Russian rubles, bartered goods or cryptocurrency.

Critics of the acting Venezuelan government argue that the move rewards Maduro loyalists, while repression, corruption and human rights abuses continue.

Many public sector workers survive on roughly $160 per month, while the average private sector employee earned about $237 last year, when the annual inflation rate soared to 475%, according to Venezuela’s central bank, and sent the cost of food beyond what many can afford.

___

Garcia Cano reported from Caracas, Venezuela. Associated Press writers Seung Min Kim, Michelle L. Price and Matt Daly contributed to this report.

Democratic gubernatorial candidates Matt Mahan, San Jose mayor, and Antonio Villaraigosa, former Los Angeles mayor, are among those who are calling on the California legislature eliminate the state excise tax for the time being.

“I’m calling on the legislature to temporarily  suspend the gasoline tax and provide relief to those who need it most,” Mahan said.

The two Democratic candidates are joining the two Republicans in the race, Riverside Sheriff Chad Bianco and former Fox News host Steve Hilton, in calling for the suspension of the gas tax.

Oil & Gas Mar 17

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Gas sold in California is normally at least $1.50 more expensive than the rest of the nation, according to economist Soverin Borenstein.

“About a dollar of that is due to the higher taxes we have, the environmental fees we have and that we use a cleaner burning gasoline, which has helped clean the air considerably,” Borenstein from the Energy Institute at Hass School of Business.

Due to the disruption of oil markets as a result of the war in Iran, the average price in the state as of Monday was an eye-popping $5.52 per gallon. Of that, appropriately 61 cents is the state excise or gas tax.

The revenue collected from the gas tax is used for road repairs and Caltrans projects across the state.

Despite the demand from the gubernatorial campaign trail, it is highly unlikely that the California legislature will suspend the gas tax. The super-majority of Democrats opposes the suspension of the gas tax as it see the suspension as robbing the state of needed revenue.

In a statement, Gov. Gavin Newsom’s office referred to gas taxes as fixed costs that do not fluctuate with the market and have nothing to do with the price spikes that Americans are experiencing.

“This excise tax goes to critical infrastructure projects that have made our roads safe and that’s why the voters voted to proactively increase this tax,” Democratic State Senator Ben Allen said in defending the need for the gas tax.

But with no end to the war and continued crisis in the Straight of Hormuz, the world’s most consequential oil transit chokehold, pressures for the state to do something may only increase.

“If the conflict drags on, it’s possible that prices could spike quite a bit higher,” Borenstein said.

Share your experience with us. Where are you finding the least expensive gas? The most expensive? Are you making any changes to your driving habits?

Use the form below to tell us about it and send us a photo of gas prices near you.

Below, some fuel saving tips.

Start by checking your car’s tires

It’s something drivers should do regularly anyway — after all, that’s where the rubber meets the road. Beyond making safety sense, properly inflated tires can help save fuel. A low tire increases the amount of fuel used. Look on the inside of your car’s door panel to find the correct PSI. Modern passenger cars usually have a PSI in the 30s.

Avoid the restaurant drive-thru line

The fast-food drive-thru might sound quick and easy, but you’re burning fuel while you wait. If your car is stopped for more than 60 seconds, shut off the engine, AAA recommends. Many new cars come with automatic start-stop to do the job for you.

Not so fast. It’s a major drag

Again, safety should be motivation enough to travel at sensible speeds. But it can also help save fuel. On freeways, aerodynamic drag causes fuel economy to drop off as speeds increase above 50 mph, AAA says. 

Oil & Gas Mar 12

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Smooth and steady wins the fuel savings race

Think smooth and steady at the stop light. Unless you’re on a Formula 1 grid, hard acceleration when the light turns is a bad idea, especially for fuel economy. Smooth acceleration allows an automatic transmission to upshift sooner, lowering engine RPM and saving gas. If you have a manual transmission, upshift as soon as you can without ‘lugging’ the engine. 

Easy does it when stopping

There’s no need to hurry up and wait, so AAA recommends taking your foot off the gas early and allowing the car to gradually and safely coast to a slower speed until its time to brake for a stop sign or stop light. 

Cruising helps avoid a bruising at the pump

Using cruise control will help you maintain a constant speed instead of regularly slowing down and speeding up on the freeway. Just don’t use it on slippery roads.  

Stash the roof rack

Try to limit your use of roof racks and other carriers. On the highway, an empty bike, canoe or ski rack can hurt fuel economy. 

Cool it without the air conditioning

AAA says it’s best to minimize your use of air conditioning. Open windows have less impact on fuel economy than the engine power required to run the air conditioning compressor, even at highway speeds. 

Stop trippin’

Try to pack as many errands as possible into one trip from home instead of making multiple trips. All that driving around is wasting gas.

Premium v. regular gas

The recommendations above are all things drivers can do on the road, but there’s one thing AAA recommends at the fuel pump. The agency says its research shows that unless your vehicle’s manufacturer specifically recommends more expensive premium fuel, it provides no added benefit over less expensive regular. So, check your car’s manual or the inside of the gas tank lid. 

The average price for a gallon of regular in Los Angeles County Monday was at $5.597, up 38 cents from a week ago with similar increases in other California counties. One month ago, the average price was $4.612 in LA County.

Where do you find cheap gas? Let us know.

The highest recorded average price in Los Angeles County is $6.495 on Oct. 5, 2022.

Statewide on Monday, the price for a gallon of regular gas stood at $5.509. As usual, that’s higher than the national average at $3.699.

The state’s highest recorded average price is $6.438 on June 14, 2022.

Some of the highest fuel prices were in coastal counties, including San Luis Obispo ($5.637/gallon), Monterey ($5.631), San Mateo ($5.685), Marin ($5.693), Sonoma ($5.668) and Humboldt ($5.857).

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Some of the lowest prices were in northeastern California, including Modoc ($5.222), Lassen ($5.196), Shasta ($5.288), Tehama ($5.166) and Butte ($5.298). Imperial County’s average price was $5.273.

The gas savings site GasBuddy.com tracks the lowest fuel prices by neighborhood.

Here’s a county-by-county breakdown of Thursday’s Southern California fuel prices (gallon of regular) compared to one week, month and year ago.

Los Angeles County
Current: $5.597
One week ago: $5.221
One month ago: $4.612
One year ago: $4.660

Orange County
Current: $5.558
One week ago: $5.211
One month ago: $4.535
One year ago: $4.626

Riverside County
Current: $5.482
One week ago: $5.104
One month ago: $4.460
One year ago: $4.483

San Bernardino County
Current: $5.479
One week ago: $5.108
One month ago: $4.452
One year ago: $4.500

Ventura County
Current: $5.548
One week ago: $5.162
One month ago: $4.544
One year ago: $4.655

The International Energy Agency said in its monthly report released Thursday that the war in Iran is “creating the largest supply disruption in the history of the global oil market.” The agency said oil being transported through the crucial Strait of Hormuz was reduced to “a trickle.”

Iran has threatened to attack U.S. Israeli or allied ships attempting to use the strait, where a fifth of the world’s oil typically passes. Any changes in shipping activity in the strait connecting the Persian Gulf to the Gulf of Oman and the Arabian Sea has a significant impact on global oil prices.

Last week, the agency released a record 400 million barrels in an attempt to counter the slowdown. The release was considered a “stop-gap measure,” officials said.

On Sunday, Energy Secretary Chris Wright said there’s “a very good chance” gas prices could drop below $3 per gallon by summer. Wright predicted that in “a few more weeks” the U.S. will have “removed the risk” of Iran’s continued global energy supplies threat.

California gas prices are significantly higher than the rest of the country for several reasons, including the isolated nature of the state’s transportation fuels market, a special gasoline recipe that reduces air pollution, environmental program costs and taxes, according to the California Energy Commission.

Below, some fuel saving tips.

Start by checking your car’s tires

It’s something drivers should do regularly anyway — after all, that’s where the rubber meets the road. Beyond making safety sense, properly inflated tires can help save fuel. A low tire increases the amount of fuel used. Look on the inside of your car’s door panel to find the correct PSI. Modern passenger cars usually have a PSI in the 30s.

Avoid the restaurant drive-thru line

The fast-food drive-thru might sound quick and easy, but you’re burning fuel while you wait. If your car is stopped for more than 60 seconds, shut off the engine, AAA recommends. Many new cars come with automatic start-stop to do the job for you.

Not so fast. It’s a major drag

Again, safety should be motivation enough to travel at sensible speeds. But it can also help save fuel. On freeways, aerodynamic drag causes fuel economy to drop off as speeds increase above 50 mph, AAA says. 

Smooth and steady wins the fuel savings race

Think smooth and steady at the stop light. Unless you’re on a Formula 1 grid, hard acceleration when the light turns is a bad idea, especially for fuel economy. Smooth acceleration allows an automatic transmission to upshift sooner, lowering engine RPM and saving gas. If you have a manual transmission, upshift as soon as you can without ‘lugging’ the engine. 

Easy does it when stopping

There’s no need to hurry up and wait, so AAA recommends taking your foot off the gas early and allowing the car to gradually and safely coast to a slower speed until its time to brake for a stop sign or stop light. 

Cruising helps avoid a bruising at the pump

Using cruise control will help you maintain a constant speed instead of regularly slowing down and speeding up on the freeway. Just don’t use it on slippery roads.  

Stash the roof rack

Try to limit your use of roof racks and other carriers. On the highway, an empty bike, canoe or ski rack can hurt fuel economy. 

Cool it without the air conditioning

AAA says it’s best to minimize your use of air conditioning. Open windows have less impact on fuel economy than the engine power required to run the air conditioning compressor, even at highway speeds. 

Stop trippin’

Try to pack as many errands as possible into one trip from home instead of making multiple trips. All that driving around is wasting gas.

Premium v. regular gas

The recommendations above are all things drivers can do on the road, but there’s one thing AAA recommends at the fuel pump. The agency says its research shows that unless your vehicle’s manufacturer specifically recommends more expensive premium fuel, it provides no added benefit over less expensive regular. So, check your car’s manual or the inside of the gas tank lid. 

The average price for a gallon of regular in Los Angeles County Thursday was at $5.407, the county’s highest average price since Oct. 29, 2023.

Oil & Gas Mar 12

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The highest recorded average price in Los Angeles County is $6.495 on Oct. 5, 2022.

Statewide on Thursday, the price for a gallon of regular gas stood at $5.368. As usual, that’s higher than the national average at $3.598.

One month ago, the California average was at $4.545. A year ago, it was $4.681.

The state’s highest recorded average price is $6.438 on June 14, 2022.

Some of the highest fuel prices were in coastal counties, including San Luis Obispo ($5.538/gallon), Monterey ($5.541), San Mateo ($5.632), Marin ($5.639), Sonoma ($5.580), Humboldt ($5.847) and Del Norte ($5.495).

Some of the lowest prices were in northeastern California, including Modoc ($5.056), Lassen ($5.015), Shasta ($5.176), Tehama ($5.085) and Butte ($5.164).

Here’s a county-by-county breakdown of Thursday’s Southern California fuel prices (gallon of regular) compared to one week, month and year ago.

Los Angeles County
Current: $5.407
One week ago: $4.880
One month ago: $4.577
One year ago: $4.677

Orange County
Current: $5.366
One week ago: $4.841
One month ago: $4.497
One year ago: $4.637

Riverside County
Current: $5.292
One week ago: $4.771
One month ago: $4.431
One year ago: $4.513

San Bernardino County
Current: $5.292
One week ago: $4.768
One month ago: $4.419
One year ago: $4.525

Ventura County
Current: $5.349
One week ago: $4.820
One month ago: $4.518
One year ago: $4.670

The International Energy Agency said in its monthly report released Thursday that the war in Iran is “creating the largest supply disruption in the history of the global oil market.” The agency said oil being transported through the crucial Strait of Hormuz was reduced to “a trickle.”

Iran has threatened to attack U.S. Israeli or allied ships attempting to use the strait, where a fifth of the world’s oil typically passes. Any changes in shipping activity in the strait connecting the Persian Gulf to the Gulf of Oman and the Arabian Sea has a significant impact on global oil prices.

Earlier this week, the agency released a record 400 million barrels in an attempt to counter the slowdown. The release was considered a “stop-gap measure,” officials said.

Gas sold in California is a blend of 90 percent petroleum based gasoline, as required by the California Air Resources Board, and 10 percent ethanol. More than 90 percent of the gasoline consumed in California comes from in-state refineries, according to the state Energy Commission.

“Electricity can go up, but it won’t go up nearly as much as gas will and it won’t go up nearly as fast, either,” said Ketels, 55, an assistant professor of global supply chain management at Wayne State University.

Experts say prolonged high gas prices may drive some EV interest and sales, especially if drivers assume their electricity prices won’t be affected by the crises.

But many factors influence consumer EV purchases — and electricity rates.

Are EV owners truly insulated from price hikes?

Drivers of gas-powered vehicles are much more vulnerable to fluctuating prices that result from global conflict than those who charge their cars. The national average for a gallon of regular gas this week was $3.57, up from $2.94 a month ago, according to AAA.

Meanwhile, “residential electricity prices are regulated and are much less volatile than gasoline prices,” said University of California, Davis economics professor Erich Muehlegger. “As a result, EV owners are largely unaffected by oil price shocks.”

But experts say electricity prices have been increasing nationally for a variety of reasons, including surging power demand from new data centers.

“This is an inflationary event,” Holt Edwards, principal in Bracewell’s Policy Resolution Group, said of the war. “Is this the driver in electricity prices? I think probably not. But it’s certainly a contributing factor.”

To what extent oil and gas conflicts could translate to the electricity sector is yet to be seen.

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What about how different grids are powered?

When it comes to the electricity an EV owner is tapping, much of the cost depends on which sources of electricity are in a local grid’s power mix, experts say.

Because regulators set residential electricity prices annually, most households are sheltered from month-to-month changes in natural gas costs. Though experts say higher natural gas prices can increase the cost of generating electricity, natural gas prices haven’t risen as quickly or as much as oil prices have recently.

Those are just two of many energy sources — including coal, nuclear and renewables — that power the electric grid.

“The energy component varies depending on the energy you’re using and the price of the energy that you’re using to generate electricity,” said Pierpaolo Cazzola, an energy expert at Columbia University’s Center on Global Energy Policy. “What happens is that in the U.S., the variation of the price of the energy component is smaller than it is elsewhere.”

The experts said persistent war could affect electricity bills in the future. And that is all the more reason for countries to transition to clean power, they said.

“Clean power and electrification combined is what provides the most security,” said Euan Graham, an analyst at energy think tank Ember.

Michael B. Klein, a 56-year-old software developer in Evanston, Illinois, has driven EVs for the past eight years to save on fuel costs and because of environmental concerns.

Every time electrical grid efficiency improves — especially as renewables are added — “I get that benefit no matter what,” said Klein, who drives a Chevy Bolt. “They can improve the efficiency of gas engines, but you have to get a new car in order to reap the benefit of that.”

So will EV demand rise?

Several experts say high gasoline prices are a strong driver of EV sales, particularly if high prices persist. Drivers also consider more gasoline-efficient hybrid vehicles during these times.

Car-shopping resource Edmunds analyzed consumer shopping data for the week starting March 2, after the Iran war had begun. They found that interest in hybrids, plug-in hybrids and battery EVs accounted for 22.4% of all vehicle research activity on their site that week, up from 20.7% the previous week. Analysts also looked back at the last major nationwide fuel price surges in 2022, and they saw that consideration of electrified vehicles consideration rose sharply then, too.

But whether this means more EV purchases depends on whether buyers expect to save not just now but in the future, experts say.

Adding to the complexity: A sudden increase in EV demand could drive up prices, Graham said.

“I think the real step change would be in whether this causes governments to shift tax, tariff policies around EVs,” Graham said. Doing so would help reduce fossil fuel dependence, he said.

Does driving electric really save money?

Pretty much.

People who buy EVs have a “really substantial” gas savings over the life of their vehicles even without government tax credits, said Peter Zalzal, an attorney with Environmental Defense Fund.

“We’re talking about thousands and thousands of dollars” in savings, Zalzal said. “And as gas prices increase, those savings are only greater. Fuel costs are a big piece of overall vehicle costs, and increases in fuel prices have significant impacts on people.”

However, the upfront cost of a new EV is still more than that of a gasoline-powered vehicle; new EVs sold for an average of $55,300 last month, while new vehicles overall sold for an average $49,353, according to auto-buying resource Kelley Blue Book. Some experts also expressed national security concerns with EVs because China dominates significant parts of the EV supply chain.

Ketels, the EV owner and professor, said he believes EVs and renewable energy should be a strategic priority for individuals and the U.S. because they could be produced domestically “and we don’t have those fluctuations and those worries.”

But because the federal government has withdrawn many incentives for both, “it puts us at a disadvantage globally,” Ketels said. “I think it’s been a terrible mistake to withdraw these incentives and to attack the sustainable energy industry,” and the war “is just making it that much more obvious.”

Following the IEA announcement, U.S. crude oil prices briefly fell to lows of the day, on news of the potential for fresh supply. But they quickly climbed higher, passing $88 per barrel around midday.

The market moves Wednesday are a sign of real concerns about a more protracted conflict, despite President Donald Trump‘s assurances this week that the U.S.-Israeli war in Iran would be over soon.

The agency did not set out a definitive timeline for when the release — the largest ever by IEA nations — would begin. “The IEA Secretariat will provide further details of how this collective action will be implemented in due course,” a statement said.

Since the attacks began Feb. 28, the Strait of Hormuz, off Iran’s southwestern coast, has been essentially shut to tanker traffic amid threats from Iran’s military. More than 20 million barrels of oil typically transit the strait every day, helping meet the world’s daily demand for more than 100 million barrels of crude oil.

On Wednesday, the United Kingdom’s maritime trade monitoring agency reported at least three ships hit with projectiles in the region.

As a result, insurers, oil companies and cargo firms have pulled back from operating in the area or transiting the critical waterway. With so much oil and liquified natural gas blocked from reaching the global market, energy prices have soared over the last two weeks.

Since the war began, U.S. crude oil prices are up more than 30%. Retail gas prices have risen more than 50 cents to a national average of around $3.57 per gallon. Natural gas, jet fuel and international oil benchmarks have also jumped significantly.

The IEA’s 32 member countries include the United States, Britain, Japan, Germany, Canada, Australia, Italy and Mexico.

The IEA said that collectively, member countries hold emergency stockpiles of more than 1.2 billion barrels.

As of mid-February, Energy Department data shows that the U.S. has a total of more than 415 million barrels of various types of crude oil sitting in the national strategic petroleum reserve. Other countries, in Europe and Japan, have millions more.

However, it will likely take some time to mobilize the reserves before they hit the global market and potentially delivery price relief.

Once a presidential order is issued to deploy oil from the national reserve, the Energy Department typically doesn’t begin deliveries for about 13 days, “and additional shipping time is needed before volumes reach end consumers,” JPMorgan Chase commodities analysts wrote in a note Tuesday.

Overall, “policy measures may have limited impact on oil prices unless safe passage through the Strait of Hormuz is assured,” the analysts said, given how much oil is currently blocked from the global market in the region.

Historically, they said, “emergency releases have peaked around 1.4 million barrels per day.”They added that it could be helpful but “that pace would not materially ease a 16 million barrels per day shortfall and would likely provide only initial relief.”

IEA countries have executed emergency releases before, notably an estimated 180 million barrels in 2022, after Russia invaded Ukraine.

In addition to oil’s rise, S&P 500 futures declined 1.5%, Dow futures plummeted 800 points, and Nasdaq 100 futures slid 1.2%, indicating U.S. stocks were poised to continue last week’s descent.

Oil rose again after a record 35% jump last week. In addition to surging oil prices, U.S. retail gas prices also soared to a national average of more than $3.450 per gallon.

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The war continues to hit oil infrastructure and push refiners to cut production. Kuwait’s state oil company said it was trimming output, while the United Arab Emirates’ state-run oil company said it was “managing” some output, hinting at possible production cuts.

The Strait of Hormuz, off southern Iran, remains essentially impassible for most oil and liquefied natural gas tankers as they try to reach the global market.

Consumers have already begun seeing increased prices at their local gas stations, and at least one analyst predicts prices will rise further. “I now estimate the chance of the national average reaching $4/gal in the next month is now 80%,” GasBuddy analyst Patrick De Haan said on X.

The conflict, in which nearly every country in the Middle East has sustained damage from missiles or drone strikes, has left ships that carry roughly 20 million barrels of oil a day stranded in the Persian Gulf, unable to safely pass through the Strait of Hormuz, the narrow mouth of the Gulf that is bordered on its north side by Iran.

The disruption and damage to key oil and gas facilities in the Middle East has led to an interruption in the supply of oil and gas.

Oil prices surpassed $90 a barrel Friday, with American crude settling at $90.90, up 36% from a week ago, and Brent, the international standard, climbing 27% over the course of the week to land at $92.69.

The fallout is ratcheting up what consumers and business will pay for gasoline, diesel and jet fuel, with some drivers already feeling it at the pump.

“It’s crazy. It’s not needed, especially at a time when people are already struggling, but not unexpected from all this turmoil that’s going on,” said Mark Doran, who was pumping gas in Middlebury, Vermont Friday. “I don’t think there’s been an end in sight to any Middle East conflict that’s been started by us, so the fact that they say that there’s going to be an end that quickly is not believable, and the Middle East is, you know, a place that the U.S. is not going to solve.”

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On Monday, President Donald Trump said that the U.S. expected its military operations against Iran to last four to five weeks but has “ the capability to go far longer.” And on Friday, Trump appeared to rule out talks with Iran absent its “unconditional surrender.”

“The more news we get, the more it seems like this is going to last a really long time,” said Al Salazar, head of macro oil and gas research at Enverus.

In the U.S., a gallon of regular gasoline rose to $3.41 on Saturday, up about 43 cents from a week ago, according to AAA motor club. Diesel was selling for $4.51 a gallon Saturday, up about 75 cents from last week.

The price shocks were felt even more heavily in Europe and Asia, markets that rely more heavily on energy supplies from the Middle East. Diesel prices doubled in Europe, and jet fuel prices rose by close to 200% in Asia, according to Claudio Galimberti, chief economist at Rystad Energy.

Energy prices climbed throughout the week as Iran launched a series of retaliatory attacks, including a drone strike on the U.S. Embassy in Saudi Arabia, and the conflict widened. Iran also hit a major refinery in Saudi Arabia and a liquefied natural gas (LNG) facility in Qatar, halting flows of refined products and taking about 20% of the world’s LNG supply offline.

“We keep seeing news of vessels being hit or refineries or pipelines, so the list is very long,” Galimberti said. As a result, roughly 9 million barrels of oil per day are off the market because of facilities being hit or producers taking precautionary measures, he said. “Right now, with all of this shut in, we are in a situation of extreme deficit.”

The U.S. is a net exporter of oil, but that does not mean it is immune to increases in the price of oil or gasoline, or that its producers can just make up the difference.

Oil is traded on global markets, so even the oil produced in the U.S. has risen in price based on what’s happening in the Middle East. And for many American oil producers, “if you put more wells in the ground, there’s about a six-month lag before you get that production uplift,” Salazar said.

In addition, the U.S. can’t simply turn all of its crude oil into gasoline. That’s because most of the oil produced in the U.S. is light, sweet crude, and refineries on the East and West coasts are primarily designed to process heavier, sour crude. As a result, the U.S. exports some of its crude oil and imports some refined products such as gasoline.

Jerry Dalpiaz of Covington, Louisiana, said he started filling up his cars and gas cans on “the day that they announced that the United States has started military operations against Iran” because he assumed gas prices would climb.

“I can weather the storm because I’m in good financial position, but I feel sorry for my fellow citizens who are living paycheck to paycheck because they have to drive to get to work and they have to change their oil and all those things,” Dalpiaz said. “And they need some relief and it doesn’t seem to be coming anytime soon.”

Trump issued a plan Friday to insure losses up to approximately $20 billion in the Gulf region, aiming to restore confidence in maritime trade, help stabilize international commerce and support American and allied businesses operating in the Middle East.

But some energy experts said extra insurance won’t solve the problem.

“The problem is that in the oil trading, oil shipping world, people are worried about counterterrorism,” said Amy Jaffe, director of the Energy, Climate Justice and Sustainability Lab at New York University, adding that they’re worried about automated drone speedboats, weapon-carrying, flying drones and mines or other devices. “In order for the United States to create the atmosphere that undoes the current bottleneck at the Strait of Hormuz, there has to be some credible demonstration of solutions to the counter-terrorism problem.”

Salazar wondered what the “new normal” would look like if the Strait of Hormuz was effectively re-opened, and what effective security would look like.

“All it takes is one individual with a RPG (rocket-propelled grenade) to stand on the shore and take out a tanker, right?” Salazar said. “And this is forever, do you know what I mean?”

___

Associated Press journalists Amanda Swinhart in Middlebury, Vermont, Stephen Smith in Covington, Louisiana and Stan Choe in New York contributed to this report.

As of March 17, the cost of regular was up about $0.87 on average from three weeks earlier — the biggest jump since March 2022, when gas prices rose $0.60 in one week after Russia invaded Ukraine. Gasoline prices were already rising before the U.S. launched strikes on Iran as refiners switch over to summer blends of fuel. But crude prices have risen sharply because of the war.

The U.S.-Israel conflict with Iran has halted shipments of oil and gas through the strategically vital Strait of Hormuz, where about 20% of global oil shipments normally travel through.

As the war drags on, the cost to fill up your tank could be even higher. Here are some tips to help stretch your dollar:

Finding the best prices

There are several apps available to help comparison shop for gas no matter where you are.

GasBuddy has an app and an interactive map on their website to help drivers find nearby gas stations and offer price information for regular, mid-grade and premium. You can search by city or zip code. The app is available to download on the Apple App store and on Google Play.

AAA’s navigation app TripTik also displays gas stations and latest per-gallon pump rates along your route. The app is available on the Apple App store and on Google Play.

Other commonly used navigation apps like Waze and Google Maps have gas station finder features that displays fuel prices. Google Maps users can also switch on the app’s eco-friendly route feature, which recommends more fuel-efficient paths that minimize hills and stop-and-go traffic patterns, which can gobble up gas. 

Is it cheaper to fill up on certain days of the week?

That depends. According to AAA, Mondays are often the cheapest day of the week to fill up your tank, followed by Fridays. Wednesdays, Thursdays, and Saturdays are historically the costliest. 

However, GasBuddy analyzed statewide rates over the past year and found that Sunday is the best day to fill up in most states, while the worst day varies from state to state.

Membership discounts

Warehouse clubs and retailers like Walmart, Costco and Amazon all offer special discounts for members to save money on gas.

Walmart Plus’ annual membership includes fuel savings of up to 10 cents per gallon at more than 13,000 stations at Walmart, Sam’s Club, Murphy Express and ExxonMobil sites.

Amazon Prime members get 10 cents off per gallon at more than 7,500 Amoco, AM/PM and BP gas stations across the country. To receive the discount, members must sign up for BP’s free Earnify rewards program, which works at all three BP-owned gas station brands.

Costco members can receive generous discounts on fuel. The exact amount varies by location, but range from five cents to 25 cents per gallon on average.

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How to improve your mileage

There are steps you can take to make your car, truck or SUV perform better or go farther — even if it’s an older model — and perhaps save some money on fuel:

Keeping Your Tires Properly Inflated 

Make sure there’s enough air in the tires. Underinflated tires create more rolling resistance with the pavement, thereby reducing gas mileage. Inflate your tires to the pressure recommended on the inside of your driver’s side door. Check them periodically with a tire pressure gauge.

“Typically, your gas mileage is going to be impacted by about 5% to 10% if you don’t have proper inflation,” said David Bennett, manager of repair systems for AAA.

But don’t over-inflate. Doing so could cause tires to wear out more quickly.

Making Sure Fluids and Filters Are Changed

Properly maintain your vehicle. Follow the manufacturer’s recommendations for oil and other fluid changes and for replacing air and other filters. Replacing spark plugs at the proper intervals can help, too.

“The vehicle is going to operate at its peak efficiency” with good maintenance, Bennett said. It will cost between $235 and $289 for new spark plugs on, say, a 10-year-old Ford F-150 pickup with a 4.6-liter V8, according to Repairpal.com.

Watch Your Speed

AAA says fuel economy peaks around 50 miles per hour on most vehicles, then drops as speed rises. Reducing highway speeds by 5 mph (8 kilometers per hour) to 10 mph improves gas mileage by up to 14%.

Coasting to stop lights also helps. Time your travel to keep rolling and avoid unnecessary stops. Cars consume a lot of fuel to get moving from a dead stop.

Plan Your Trip in Advance 

Try to minimize backtracking. Do multiple tasks on each trip. Avoid rush hours and other peak travel times.

Don’t Idle Too Much 

An engine burns one-quarter to a half-gallon (1.9 liters) of gas per hour when idling, but a warm engine needs only around 10 seconds worth of fuel to restart, according to AAA.

So when safely possible, shut your engine off if you’ll be stopped for more than a minute. Many new vehicles do this on their own. Bennett says owners shouldn’t disable their new “stop-start” system.

“Top Tier” Gas

Fill up with gasoline designated as “Top Tier.” Oil companies put additives in Top Tier gas that cuts carbon deposits.

“As you start getting carbon buildup, the vehicle will not be running as efficiently,” Bennett said. Gasoline brands with the additives have stickers on the pumps. They can be found at here.

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U.S. crude oil jumped 7% in early evening trading, while Brent crude, the international benchmark, climbed 8%. The surge follows an already sharp rise in oil prices, which had increased 17% this year before the weekend’s gains.

Financial analysts said the attack on Iran could disrupt oil supplies in the Middle East because shipping through the Strait of Hormuz could be unsafe for cargo ships. The narrow waterway along Iran’s southern coast is a critical transit route, with about one-fifth of the world’s oil supply passing through it each day.

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Experts say a closure or significant restriction of the strait would be among the worst-case scenarios for global oil markets.

“This will quickly translate into higher prices at the pump for American drivers,” said Christine Romans, senior business correspondent for NBC News. “Looking at it this way, a $1 rise in crude oil prices generally means up to two and a half cents more for a gallon of gasoline. So, quick math, a $10 spike in oil would be up to 25 cents more for a gallon of gasoline.”

Some drivers told NBCLA they are already struggling with current fuel costs, adding it was already difficult to make ends meet.  

Victoria Jensen, an Uber driver, said higher gas prices is going to cut into her profit and make it harder to pay her other bills.

“Hugely, because a lot of times the work is slow and when the prices are really high, that just makes it a lot harder for us to make money for ourselves, for our cost of like, rent, other bills,” Jensen said.Analysts warn that higher gas prices could stick around for a while, but how long they last will depend on how the conflict in Iran develops.

Venezuela had faced U.S. sanctions on its oil for several years, relying on a shadow fleet of falsely flagged tankers to smuggle crude into global supply chains. President Donald Trump ordered a quarantine of sanctioned tankers in December to pressure then-President Nicolás Maduro before Maduro was apprehended in January during an American military operation.

Several tankers fled the Venezuelan coast in the wake of the raid, including the ship that was boarded in the Indian Ocean overnight. The Defense Department said in a post on X that U.S. forces boarded the Veronica III, conducting “a right-of-visit, maritime interdiction and boarding.”

“The vessel tried to defy President Trump’s quarantine — hoping to slip away,” the Pentagon said. “We tracked it from the Caribbean to the Indian Ocean, closed the distance, and shut it down.”

Video posted by the Pentagon shows U.S. troops boarding the tanker.

The Veronica III is a Panamanian-flagged vessel under U.S. sanctions related to Iran, according to the website of the Treasury Department’s Office of Foreign Assets Control. The Panama Maritime Authority said Sunday in a brief statement that the ship was no longer registered there and had been canceled in December 2024.

The Veronica III left Venezuela on Jan. 3, the same day as Maduro’s capture, with nearly 2 million barrels of crude and fuel oil, TankerTrackers.com posted Sunday on X.

“Since 2023, she’s been involved with Russian, Iranian and Venezuelan oil,” the organization said.

Samir Madani, co-founder of TankerTrackers.com, told The Associated Press in January that his organization used satellite imagery and surface-level photos to document that at least 16 tankers left the Venezuelan coast in contravention of the quarantine.

The Trump administration has been seizing tankers as part of its broader efforts to take control of the Venezuela’s oil. The Pentagon did not say in the post whether the Veronica III was formally seized and placed under U.S. control, and later told the AP in an email that it had no additional information to provide beyond that post.

Last week, the U.S. military boarded a different tanker in the Indian Ocean, the Aquila II. The ship was being held while its ultimate fate was decided by the United States, according to a defense official who spoke last week on condition of anonymity to discuss ongoing decision-making.

—

Associated Press writers Konstantin Toropin in Washington and Alma Solís in Panama City contributed to this report.

The oil industry has been seeking access to new offshore areas, including Southern California and off the coast of Florida, as a way to boost U.S. energy security and jobs. The federal government has not allowed drilling in federal waters in the eastern Gulf of Mexico, which includes offshore Florida and part of offshore Alabama, since 1995, because of concerns about oil spills. California has some offshore oil rigs, but there has been no new leasing in federal waters since the mid-1980s.

Since taking office for a second time in January, Trump has systematically reversed former President Joe Biden’s focus on slowing climate change to pursue what the Republican calls U.S. “energy dominance” in the global market. Trump, who recently called climate change “the greatest con job ever perpetrated on the world,” created a National Energy Dominance Council and directed it to move quickly to drive up already record-high U.S. energy production, particularly fossil fuels such as oil, coal and natural gas.

Meanwhile, Trump’s administration has blocked renewable energy sources such as offshore wind and canceled billions of dollars in grants that supported hundreds of clean energy projects across the country.

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Even before it was released, the offshore drilling plan met strong opposition from California Gov. Gavin Newsom, a Democrat who is eyeing a 2028 presidential run and has emerged as a leading Trump critic. Newsom pronounced the idea “dead on arrival” in a social media post. The proposal also is likely to draw bipartisan opposition in Florida. Tourism and access to clean beaches are key parts of the economy in both states.

Plans to allow drilling off California, Alaska and Florida’s coast

The administration’s plan proposes six offshore lease sales between 2027 and 2030 in areas along the California coast.

It also calls for new drilling off the coast of Florida in areas at least 100 miles from that state’s shore. The area targeted for leasing is adjacent to an area in the Central Gulf of Mexico that already contains thousands of wells and hundreds of drilling platforms.

The five-year plan also would compel more than 20 lease sales off the coast of Alaska, including a newly designated area known as the High Arctic, more than 200 miles offshore in the Arctic Ocean.

Interior Secretary Doug Burgum said in announcing the sales that it would take years for the oil from those parcels to get to market.

“By moving forward with the development of a robust, forward-thinking leasing plan, we are ensuring that America’s offshore industry stays strong, our workers stay employed, and our nation remains energy dominant for decades to come,” Burgum said in a statement.

The American Petroleum Institute said in response that the announced plan was a “historic step” toward unleashing vast offshore resources. Industry groups have pointed to California’s history as an oil-producing state and say it already has infrastructure to support more production.

Opposition from California and Florida

Sen. Rick Scott, a Florida Republican and Trump ally, helped persuade Trump officials to drop a similar offshore plan in 2018 when he was governor. Last week, Scott and fellow Florida Republican Sen. Ashley Moody co-sponsored a bill to maintain a moratorium on offshore drilling in the state that Trump signed in his first term.

“As Floridians, we know how vital our beautiful beaches and coastal waters are to our state’s economy, environment and way of life,” Scott said in a statement. “I will always work to keep Florida’s shores pristine and protect our natural treasures for generations to come.”

A Newsom spokesman said Trump officials had not formally shared the plan, but said “expensive and riskier offshore drilling would put our communities at risk and undermine the economic stability of our coastal economies.”

California has been a leader in restricting offshore oil drilling since the infamous 1969 Santa Barbara spill that helped spark the modern environmental movement. While there have been no new federal leases offered since the mid-1980s, drilling from existing platforms continues.

Newsom expressed support for greater offshore controls after a 2021 spill off Huntington Beach and has backed a congressional effort to ban new offshore drilling on the West Coast.

A Texas-based company, with support from the Trump administration, is seeking to restart production in waters off Santa Barbara damaged by a 2015 oil spill. The administration has hailed the plan by Houston-based Sable Offshore Corp. as the kind of project Trump wants to increase U.S. energy production as the federal government removes regulatory barriers.

Trump signed an executive order on the first day of his second term reversing Biden’s ban on future offshore oil drilling on the East and West coasts. A federal court later struck down Biden’s order to withdraw 625 million acres of federal waters from oil development.

Environmental and economic concerns over oil spills

Democratic lawmakers, including California Sens. Alex Padilla and Rep. Jared Huffman, the top Democrat on the House Natural Resources Committee, warned that opening vast coastlines to new offshore drilling would hurt coastal economies, jeopardize national security, ravage coastal ecosystems, and put the health and safety of millions of people at risk.

“With this draft plan, Donald Trump and his Administration are trying to destroy one of the most valuable, most protected coastlines in the world and hand it over to the fossil fuel industry,” Padilla and Huffman said in a joint statement.

One disastrous oil spill can cost taxpayers billions in lost revenue, cleanup costs and ecosystem restoration, they said.

Joseph Gordon, campaign director for the environmental group Oceana, called the Trump administration’s latest plan “an oil spill nightmare.”

Coastal communities “depend on healthy oceans for economic security and their cherished way of life,” he said. “There’s too much at stake to risk more horrific oil spills that will haunt our coastlines for generations to come.”

An explosion and fire at California’s second-largest oil refinery raised concerns about a potential rise in the state’s already high fuel prices, but by how much and when remains to be seen as authorities determine the extent of the damage at the expansive property in El Segundo.

Firefighters were still pouring water on the fire Friday morning, hours after residents said they felt a rumble from an explosion before flames cast an eerie orange glow over homes in the coastal South Bay community south of Los Angeles International Airport. The fire, which Chevron said began at a processing unit near the southeast corner of the refinery, was out later Friday morning, the company said, but damage was still being assessed.

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The refinery, which has been in operation since 1911, is capable of refining 290,000 barrels of crude oil per day, including gasoline, jet and diesel fuels. The refinery supplies a significant amount of the motor fuel used by Southern Californians and accounts for about 17 percent of California’s crude oil capacity, according to the California Energy Commission.

“Depending on the time of year, about a sixth of all the gasoline in Southern California is refined through this plant,” said El Segundo Mayor Chris Pimentel.

The impact on fuel prices will depend largely on what was damaged and the extent of the damage, said Matt McClain, a petroleum analyst with GasBuddy.com. The service tracks fuel price trends and the petroleum industry.

“How much of an increase in the price of gas can people expect? Anywhere from 15 to 30 cents a gallon, 25 cents a gallon, and we’re going to leave a little asterisk beside that because it’s still an unfolding situation on the extent of the damage,” McClain said. “It was not a small fire… so the key of the matter is what was damaged, how extensive is the damage and how long will it take to repair.”

Californians already pay the nation’s highest prices for gas. A gallon of regular gas was priced Friday morning at $4.642 in California. The national average for a gallon of regular was $3.152.

In a statement Friday, Chevron said the fire was at a processing unit near the southeast corner of the sprawling property. Flames were contained to the refinery and did not spread into residential areas.

Sources told Reuters that the fire was confined to a jet fuel production unit.

Chevron said it is providing updates to the California Energy Commission on damage.

“We are closely monitoring the situation and remain in direct contact with the refiner, state and local partners, and labor leadership,” the commission told NBCLA. “We are glad no one was injured in the incident.”

The cause of the explosion and fire at is unknown and under investigation. Several federal, state and local agencies will likely be part of the investigation.

California Gov. Gavin Newsom’s office said it was monitoring the situation.

The refinery covers roughly 1.5 square miles and has more than 1,100 miles of pipelines, according to the company’s website.

The refinery has more than a century of history in the seaside community. In 1911, when kerosene for lamps was in high demand, the location was selected as the site for Standard Oil Company’s second refinery in California.

The city was named El Segundo, “the second” in Spanish, in recognition of the refinery.

The company’s name was changed to Chevron Corporation in 1984.

There have been several fires at the refinery in the last decade, the latest in 2022. A fire in 2017 threatened storage tanks and sent huge flames into the sky before crews quickly smothered it. It did not burn near any of the facility’s main processing units, Chevron said.

Chevron was fined nearly $1 million by the state of California for a major fire in 2012 at a refinery in the San Francisco Bay Area.

California’s largest refinery is Marathon Oil Corp.’s Los Angeles Refinery in nearby Carson.

Further limiting California’s refinery capacity, the Phillips 66 refinery in Wilmington and Carson is due to shut down by the end of the year. The company announced closure plans last year.

Firefighters were still pouring water on the fire Friday morning, hours after residents said they felt a rumble from an explosion before flames cast an eerie orange glow over homes in the coastal South Bay community south of Los Angeles International Airport. The fire, which Chevron said began at a processing unit near the southeast corner of the refinery, was out later Friday morning, the company said.

White smoke continued to drift over the community Friday morning after a night with moments of uncertainty for residents.

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Deb Dipprey’s house has a direct line of sight from her porch to the refinery. She felt the explosion and could feel a blast of heat when she walked outside.

“We felt the house move,” said resident Deb Dipprey. “The windows shook. We heard the explosion and then the next thing, we felt the fire. The fire was really large and we could feel the heat.

“It was probably over 100 degrees on our porch.”

The cause of the explosion and fire at the oil processing plant is unknown and under investigation.

It was not immediately clear how the fire and its impact on refinery operations might impact fuel prices. Californians already pay the nation’s highest prices for gas. Chevron said it is providing updates to the California Energy Commission.

“We are closely monitoring the situation and remain in direct contact with the refiner, state and local partners, and labor leadership,” the commission told NBCLA. “We are glad no one was injured in the incident.”

A gallon of regular gas was priced Friday morning at $4.642 in California. The national average for a gallon of regular was $3.152.

No injuries were reported. Evacuations were not in effect, but authorities said they are monitoring air quality.

“All refinery personnel and contractors have been accounted for and there are no injuries,” Allison Cook, a Chevron spokesperson, said in a statement. “No evacuation orders for area residents have been put in place by emergency response agencies monitoring the incident, and no exceedances have been detected by the facilities fence line monitoring system.”

A shelter in place order issued for the nearby Manhattan Beach’s Tree Section neighborhood was lifted early Friday morning.

“I never ever fear anything. This (fire), I got in panic mode when I saw it,” a neighbor told NBC4. “It looked like about 7 to 10 football fields wide of a flame and smoke billowing in the air.”

The fire, confined to the refinery property, was still burning Friday morning, but contained, according to city officials. California Gov. Gavin Newsom’s office said it was monitoring the situation.

“All roads have been reopened after last night’s Chevron fire,” The city of El Segundo posted Friday morning. “The fire is still burning but is contained at this time.”

The refinery’s on-site fire department and the El Segundo Fire Department train together in preparation for fires at the plant, said El Segundo Mayor Chris Pimentel.

The refinery covers roughly 1.5 square miles and has more than 1,100 miles of pipelines, according to the company’s website. The refinery, which has been in operation since 1911, can refine up to 290,000 barrels of crude oil a day, including gasoline, jet and diesel fuels, according to the company’s website.

The refinery has more than a century of history in the seaside community. In 1911, when kerosene for lamps was in high demand, the location was selected as the site for Standard Oil Company’s second refinery in California.

The city was named El Segundo, “the second” in Spanish, in recognition of the refinery.

The company’s name was changed to Chevron Corporation in 1984.

There have been several fires at the refinery in the last decade, the latest in 2022. A fire in 2017 threatened storage tanks and sent huge flames into the sky before crews quickly smothered it. It did not burn near any of the facility’s main processing units, Chevron said.

Chevron was fined nearly $1 million by the state of California for a major fire in 2012 at a refinery in the San Francisco Bay Area.

The price of Brent crude oil, the international standard, rose 3.3% to $79.60 a barrel. U.S. crude rose 3.1% to $76.16 a barrel.

On Saturday, U.S. forces attacked three Iranian nuclear and military sites, further increasing the stakes in the war between Israel and Iran.

Futures for the S&P 500 fell 0.5%, while futures for the Dow Jones Industrial Average slipped 0.4%. Treasury yields fell slightly. The modest moves indicate markets are taking the latest development in stride.

The conflict, which began with an Israeli attack against Iran on June 13, has sent oil prices yo-yoing, which has in turn caused see-saw moves for the U.S. stock market, because of rising and ebbing fears that the war could disrupt the global flow of crude. Iran is a major producer of oil and also sits on the narrow Strait of Hormuz, through which much of the world’s crude passes.

An Iran retaliation that included closing off the waterway would be technically difficult to pull off but traders are afraid Iran could severely disrupt transit through it, sending insurance rates spiking and making shippers nervous to move without U.S. Navy escorts.

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Some analysts think Iran is unlikely to close down the waterway because the country uses it to transport its own crude, mostly to China, and oil is a major source of revenue for the regime.

“It’s a scorched earth possibility, a Sherman-burning-Atlanta move,” said Tom Kloza, chief market analyst at Turner Mason & Co. “It’s not probable.”

Kloza thinks oil futures will ease back down after initial fears blow over.

Ed Yardeni, a long-time analyst, agreed, writing in a report that Tehran leaders would likely hold back.

“They aren’t crazy,” he wrote in a note to investors Sunday. “The price of oil should fall and stock markets around the world should climb higher.”

Other experts aren’t so sure.

Andy Lipow, a Houston analyst covering oil markets for 45 years, said countries are not always rational actors and that he wouldn’t be surprised if Tehran lashed out for political or emotional reasons.

“If the Strait of Hormuz was completely shut down, oil prices would rise to $120 to $130 a barrel,” said Lipow, predicting that that would translate to about $4.50 a gallon at the pump and hurt consumers in other ways.

“It would mean higher prices for all those goods transported by truck, and it would be more difficult for the Fed to lower interest rates.”

The company announced this week that Prime Day 2025 will be extended to four days, kicking off on July 8 and ending on July 11.

However, one of the best early deals for Prime members might be the offer running over the Fourth of July holiday: a gas discount.

Prime members can get $1 off per gallon at the pump from July 3 to July 6.

Last year, the company added a fuel discount to its list of perks, giving Prime members 10 cents off per gallon at thousands of gas stations across the U.S.

Prime members already receive free shipping, Whole Foods savings, prescription benefits, access to Amazon video, music, gaming, photo storage and more, including the a free one-year membership to Grubhub’s premium “Plus” delivery service and discounts on prescription drugs. The cost of membership is $139 a year. Discounted memberships are available for students with a valid school email account at $69 a year.

The discount comes as prices at the pump averaged $3.16 a gallon for regular, according to AAA.

How to get the Amazon Prime gas discount

The $1 gas discount applies at more than 7,500 Amoco, AM/PM and BP gas stations across the country. To receive the discount, members must sign up for BP’s free Earnify rewards program, which works at all three BP-owned gas station brands.

Members then have to visit Amazon.com’s fuel savings page here to link their Prime account to their Earnify account. Next, download the Earnify app to find your nearest Amoco, AM/PM or BP gas station.

To redeem the offer at the pump, input your phone number or linked payment method when fueling. Members can also use the Earnify app to select the gas station and pump they are using to redeem the discount.

The $1 per gallon discount applies for up to 35 gallons. However, Prime members can still save 10 cents per gallon throughout the year.

The rules aimed to reduce emissions of smog-contributing nitrogen oxides, also called NOx, a group of pollutants linked to respiratory issues, asthma attacks, worse allergies, decreased lung function in children, premature death and more. Burning natural gas is also one of the primary drivers of climate change.

The South Coast Air Quality Management District estimates that the rules would have lowered NOx emissions from gas-fired furnaces, preventing about 2,490 premature deaths and 10,200 new asthma cases over a 26-year period in the region. The district regulates air quality for 16.8 million people in Southern California, including all of Orange County and large areas of Los Angeles, Riverside and San Bernardino counties — one of the smoggiest areas in the U.S.

The board received more than 30,000 written comments ahead of the vote, including a letter from U.S. Attorney Bilal “Bill” Essayli, the top federal prosecutor in the area, threatening to sue the board if they adopted the rules.

“California regulators are on notice: if you pass illegal bans or penalties on gas appliances, we’ll see you in court,” he posted Thursday on the social platform X. “The law is clear—feds set energy policy, not unelected climate bureaucrats.”

Before the vote, board member Janet Nguyen, who serves on the Orange County Board of Supervisors, echoed opponents’ concerns that the rules would financially burden people.

“I, like everybody here, support clean air,” she said, adding, “These rules don’t target refineries or shopping ports. They target people. The 17 million homeowners, renters, seniors and small businesses.”

Los Angeles County Supervisor Holly J. Mitchell, who supported the rules, said, “If we don’t start now, when will we affect any change?”

California’s trailblazing environmental standards

California is moving aggressively to reduce the state’s reliance on planet-warming fossil fuels ahead of a 2045 mandate for the state to have net-zero carbon emissions. California often sets or proposes stricter environmental standards than the rest of the country, including efforts to ban the sale of new gas-powered cars by 2035.

The rules would have set targets that aimed to phase out the sale of gas-powered furnaces and water heaters starting in 2027. It would not have applied to gas stoves. The sales target would have started at 30%, then grown to 50% in 2029 and ended at 90% in 2039. The rules would not have been mandated, but manufacturers would have had to pay fees ranging from $50 to $500 if they sold gas-powered appliances.

That’s a significant rollback from the original proposal, which would have required residential buildings to meet zero-emissions standards beginning in 2029 when appliances need to be replaced. The agency amended the rules after strong opposition from Southern California Gas and other businesses.

The regulations would have impacted more than 10 million appliances in an estimated 5 million buildings, most of them residential.

Officials and supporters say the rules would have reduced air pollution and substantially improved public health. But opponents — including property owners, industry professionals and natural gas companies — feared they would raise costs for consumers and businesses, and strain the power grid by adding more electric appliances.

Residents disagree in packed public comments

During a packed board meeting Friday that ran for five hours, clean air advocates held signs reading “Clean Air Now,” “Vote 4 Clean Air, Vote 4 Justice” and “Let SoCal Breath!”

Before public comments, board chair Vanessa Delgado thanked the more than 200 people who signed up to speak about the rules, which took more than two years to craft.

“I don’t believe that there’s necessarily a good or right answer about these rules,” she said. “I believe that it is very complicated and I know that every single one of these board members are doing what is right to move forward air quality goals in our region.”

Lynwood City Councilmember Juan Muñoz-Guevara said the rules would be a long-overdue step toward environmental justice for communities like his.

“I’ve seen firsthand how families in my community are forced to live with the health consequences of dirty air. Our children grow up with asthma, our elders struggle with respiratory illness, and too many lives are cut short,” he said. “Gas appliances in our home are one of the largest sources of smog-forming pollution in the region. We cannot meet clean air goals without tackling this.”

Peggy Huang, a member of Yorba Linda’s City Council, urged the board to reject the rules.

“As someone who’s been advocating for affordable housing, this will increase costs for us to meet those goals,” Huang said.

Chino’s mayor pro tem, Curtis Burton, echoed some of Huang’s concerns. He said the rules would “create an additional financial burden on residents and businesses.”

Air quality regulators say the rules would save consumers money by reducing energy bills.

Amazon announced its Prime members can score additional fuel savings during the month of June.

Last year, the company added a fuel discount to its list of perks, giving Prime members 10 cents off per gallon at thousands of gas stations across the U.S. From now until June 30, Amazon is increasing the discount to 20 cents per gallon on Fridays.

Prime members already receive free shipping, Whole Foods savings, prescription benefits, access to Amazon video, music, gaming, photo storage and more, including the a free one-year membership to Grubhub’s premium “Plus” delivery service and discounts on prescription drugs. The cost of membership is $139 a year. Discounted memberships are available for students with a valid school email account at $69 a year.

The discount comes as prices at the pump averaged $3.14 a gallon for regular, according to AAA.

How to get the Amazon Prime gas discount

The 20-cent gas discount applies at more than 7,500 Amoco, AM/PM and BP gas stations across the country. To receive the discount, members must sign up for BP’s free Earnify rewards program, which works at all three BP-owned gas station brands.

Members then have to visit Amazon.com’s fuel savings page here to link their Prime account to their Earnify account. Next, download the Earnify app to find your nearest Amoco, AM/PM or BP gas station.

To redeem the offer at the pump, input your phone number or linked payment method when fueling. Members can also use the Earnify app to select the gas station and pump they are using to redeem the discount.

The average price is 3.9 cents more than one week ago, but 10.7 cents less than one month ago and 48.2 cents less than one year ago, according to figures from the AAA and the Oil Price Information Service. It has dropped $1.705 since rising to a record $6.493 on Oct. 5, 2022.

The Orange County average price rose 2.5 cents to $4.74, also its fourth consecutive increase. It is 4.6 cents more than one week ago, but 10 cents less than one month ago and 44.9 cents less than one year ago. It has dropped $1.718 since rising to a record $6.458 on Oct. 5, 2022.

The national average price dropped for the eighth time in nine days, decreasing six-tenths of a cent to $3.139. It is 3.1 cents less than one week ago, 8.3 cents less than one month ago and 49.7 cents less one year ago. It has dropped $1.877 since rising to a record $5.016 on June 14, 2022.

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The nearly 2,700-mile Keystone oil pipeline was shut down Tuesday morning after it ruptured in North Dakota, halting the flow of millions of gallons of crude oil from Canada to refineries in the U.S. and potentially leading to higher gasoline prices.

South Bow, a liquid pipeline business that manages the pipeline, said it shut down the pipeline after control center leak detection systems detected a pressure drop in the system. The spill is confined to an agricultural field in a rural area, about 60 miles southwest of Fargo.

“The affected segment has been isolated, and operations and containment resources have been mobilized to site,” the company said. “Our primary focus right now is the safety of onsite personnel and mitigating risk to the environment.”

The pipeline transported an average 624,000 barrels — or more than 26 million gallons — per day in 2024, according to Canadian regulators. It stretches 2,689 miles from Alberta, Canada, to Texas.

Prices at the gas pump could rise in the coming days

The pipeline’s shutdown could quickly lead to higher gasoline prices in the Midwest, said Ramanan Krishnamoorti, vice president for energy and innovation at the University of Houston.

It could raise prices at the pump within one or two days, but will have a greater impact on diesel and jet fuel, Krishnamoorti said. The Keystone pipeline transports a large amount of a unique, heavy crude that only is available from limited sources, he said.

“The refineries run on blends of crude so that they can get the product line that they want to deliver, whether it is gasoline, diesel, jet fuel, etc., and not having the supply of heavy crude is going to tilt their ability to make diesel and jet fuel,” he said. “They will make less of diesel and jet fuel when they have less of the heavy crude.”

Higher diesel costs could lead to grocery price increases because diesel trucks transport those products, he said.

The lead petroleum analyst at gasoline price tracker GasBuddy, Patrick De Haan, said that typically refineries have at least a few days supply of crude oil on hand that will insulate them from immediate impacts from the shut down. But if the shutdown continues more than a few days or a week it could become problematic.

Mark LaCour, editor-in-chief of the Oil and Gas Global Network, said he doesn’t expect gas prices to immediately increase because the major refineries served by the Keystone pipeline have millions of barrels in storage.

“Even if the pipeline gets cut off completely for, say, 2 or 3 weeks, they have enough crude to continue refining for gasoline,” LaCour said.

The pipeline was shut down within two minutes of a ‘bang’

It wasn’t clear what caused the rupture of the underground pipeline. An employee working at the site near Fort Ransom heard a “mechanical bang” and shut down the pipeline within about two minutes, said Bill Suess, spill investigation program manager with the North Dakota Department of Environmental Quality.

Oil surfaced about 300 yards south of a pump station in a field and emergency personnel responded, Suess said.

No people or structures were affected by the spill, he said. A nearby stream that only flows during part of the year was not affected but was blocked off and isolated as a precaution, he said. The Pipelines and Hazardous Materials Safety Administration is sending a team to investigate the cause of the leak.

Fort Ransom, a city of less than 100 people, is in a hilly, forested area of southeastern North Dakota known for scenic views and outdoor recreation. A state park and hiking trails are nearby.

It’s unclear at what rate the 30-inch pipeline was flowing, but even at two minutes “it’s going to have a fairly good volume,” Suess said. “But … we’ve had much, much bigger spills,” including one involving the same pipeline a few years ago in Walsh County, North Dakota, he said.

“I don’t think it’s going to be that huge,” Suess said.

The pipeline has a history of past ruptures

The Keystone Pipeline was constructed in 2010 at a cost of $5.2 billion and carries crude oil across Saskatchewan and Manitoba through North Dakota, South Dakota, Nebraska, Kansas and Missouri to refineries in Illinois, Oklahoma and Texas. Though the pipeline was constructed by TC Energy, it is now managed by South Bow as of 2024.

A proposed extension to the pipeline called Keystone XL would have transported crude oil to refineries on the Gulf Coast, but it was ultimately abandoned by the company in 2021 after years of protests from environmental activists and Indigenous communities over environmental concerns.

After a spill, the Pipeline and Hazardous Materials Safety Administration is responsible for investigating the root cause of the issue and any lack of compliance. The agency, which regulates liquid and natural gas pipelines, lost several senior-level executives earlier this year as part of President Donald Trump’s federal cuts.

PHMSA did not immediately respond to a request for comment.

Bill Caram, executive director at industry watchdog Pipeline Safety Trust, said the organization already was “an under-resourced, underfunded agency.”

“To lose anyone will have an impact on safety,” he said.

After the last major Keystone pipeline spill in Kansas in December 2022, sections of the pipeline were offline for a little over three weeks before it resumed operating at a lower pressure.

That spill of nearly 13,000 barrels of oil flowed into a creek traversing a pasture. An engineering consulting firm said the bend in the pipeline at the site had been “overstressed” since being installed in 2010, likely because of construction activity altering the land around the pipe. TC Energy said a faulty weld in the line’s bend caused a crack that exacerbated over time.

The Pipeline Safety Trust said this latest leak adds to the troubled history of the Keystone pipeline, which has had 13 significant incidents in the 15 years it has been operating.

Raza reported from Sioux Falls, South Dakota. Associated Press writer Josh Funk contributed from Omaha, Nebraska.