U.S. Energy Secretary Predicts Gas Prices Above $3 Until 2027 Amid Ongoing Iran Conflict

U.S. gas prices have surged to an average of $4.04 per gallon amid the ongoing war with Iran, which has disrupted global oil supplies. The conflict has led to the closure of the Strait of Hormuz, a key shipping route carrying about a fifth of the world's oil.

Oil prices are hovering near $90 per barrel, contributing to the spike at the pump. This assessment stems from supply disruptions caused by Middle East tensions. Pre-war prices averaged $2.90 per gallon.

According to reports, the president said gas prices will fall as soon as the Iran conflict ends. This rejection highlights differing views within the administration on energy market recovery. He described under $3 per gallon as tremendous in inflation-adjusted terms, last seen during previous administrations but not recently.

and Iran announced the Strait of Hormuz was opening for commerce. However, hopes for a lasting ceasefire dimmed when Iran fired on two tankers transiting the strait over the weekend. No casualties were reported in these incidents. U.S. envoys are set to meet with Iranian counterparts in Islamabad, Pakistan, on Monday for talks aimed at ending the war.

The U.S. recently seized the Iranian-flagged ship Touska in the Gulf of Oman.

The war has wreaked havoc on energy markets, with Tehran largely locking up traffic through the critical channel. AAA data shows the national average has soared from $2.90 per gallon before the conflict. He emphasized that resolution of the conflict would lead to lower energy prices.

The administration has faced scrutiny over handling of the crisis, with gas prices more than $4 per gallon representing a massive spike from months ago. Supply disruptions and tensions continue to drive market volatility.