US oil prices are in for another day of extreme swings as the US-Israel war against Iran extends into its third week, with fuel costs rising sharply across the country. Analyst Patrick De Haan has put the likely Monday pump price at $3.80 to $3.85 per gallon, while noting that $4 is not yet off the table. The conflict shows no signs of de-escalating, leaving energy markets in a state of prolonged uncertainty.
Before the first strikes were launched against Iran on February 28, Americans were filling up for under $3 per gallon. Since then, the national average has risen by 23% to $3.70, driven by the progressive destruction of oil infrastructure and the shutdown of key shipping lanes. Consumer advocacy organizations have described the price increase as one of the fastest in recent decades.
The strikes on Kharg Island on Friday represented a major new escalation, targeting one of Iran’s central oil export hubs. Iran has responded by maintaining its blockade of the Strait of Hormuz, effectively cutting off roughly 20% of the global oil supply. Brent crude climbed to $106 per barrel early Monday before retreating to $103, and US crude remained around $94 after testing the $100 mark over the weekend.
Californians have faced the most dramatic price spikes, with the statewide average surpassing $5 and some Los Angeles stations charging over $8 per gallon. Diesel fuel, used widely in logistics and transportation, may reach $5.15 per gallon across the US. The heads of Exxon, Chevron, and ConocoPhillips have all communicated supply-related concerns to Washington officials, with Exxon’s Darren Woods specifically warning about the role of market speculation.
Wall Street made modest gains Monday as oil prices temporarily softened, with the S&P 500 up about 1% in morning trading. Major oil company stocks have surged to all-time highs since the conflict began, reflecting strong investor confidence in the energy sector. The outlook for ordinary consumers, however, remains bleak as long as the Strait of Hormuz remains blocked and military operations continue.