U.S. and Iran sign memorandum; oil prices fall, gas averages $3.999

U.S. retail gasoline prices averaged $3.999 per gallon on Thursday, the first time the national average has fallen below $4 since March, according to data from the American Automobile Association. The decline followed the signing of a memorandum of understanding between the United States and Iran on Wednesday.

The agreement provides for Iran to dilute its stockpile of highly enriched uranium and waives U.S.-backed sanctions, allowing Iran to resume oil exports. Maritime tracking data from Lloyd’s List Intelligence showed major ship owners routing vessels through the Strait of Hormuz after the signing.

Vice President JD Vance stated Thursday that the Navy had lifted its blockade to permit some transit to and from Iranian ports.

The memorandum also calls for a permanent end to hostilities and establishes a 60-day period for negotiations on Iran’s nuclear program. President Trump indicated that attacks could resume if talks do not progress.

Brent crude fell below $78 per barrel and U.S. benchmark crude dropped to just over $74 per barrel on Thursday. Regional gasoline prices varied, with California averaging $5.64 per gallon and Hawaii at $5.57, while Indiana and Texas recorded $3.40 and $3.49 respectively.

American drivers are paying roughly $1 more per gallon than before the February conflict involving the United States and Israel, and prices remain 25 percent higher than one year ago. Supply chain effects from that period continue to affect inventories and input costs for sectors including agriculture.

Pat Penfield, professor of supply chain practice at Syracuse University, stated that product prices across the United States are projected to keep climbing for the rest of 2026, citing depleted inventories and higher spring fertilizer costs that will reach consumers by autumn.