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By Suzanne Blake
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Several U.S. states are now averaging more than $4 a gallon for regular gasoline as the war with Iran continues to severely disrupt global oil markets.
The conflict has pushed fuel costs higher across the country, according to the latest data from the American Automobile Association (AAA).
Why It Matters
Gas prices approaching, and in some states exceeding, $4 a gallon have immediate consequences for household budgets, especially as the Iran war continues to impact global oil markets.
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According to the AAA, the national average price for regular gasoline has surged to about $3.88, up nearly a dollar in less than a month, putting the U.S. on the brink of a nationwide return to $4 gas for the first time since 2022.
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What To Know
As of AAA’s most recent state‑by‑state averages, the following states are reporting regular gasoline prices above $4 per gallon:
- California – $5.61
- Washington – $5.14
- Hawaii – $5.07
- Nevada – $4.66
- Oregon – $4.70
- Arizona – $4.43
- Alaska – $4.42
- Illinois – 4.04
AAA data shows that the highest prices remain concentrated in Western states, with California once again standing out as the most expensive market in the nation, well above the national average.
“States on the West Coast, and really any state with higher gas taxes, are going to feel this the most and are the most likely to push above $4,” Kevin Thompson, the CEO of 9i Capital Group and the host of the 9innings podcast, told Newsweek.
“When you layer state taxes on top of already elevated energy costs, it adds up quickly. Now, those taxes do serve a purpose like funding infrastructure and public transit, but the reality is, consumers feel it immediately at the pump.”
The national average price for a gallon of regular gas climbed to $3.884 on Thursday, up from $3.598 just a week earlier and nearly a dollar higher than prices seen in late February.
Experts point to the escalating conflict with Iran as the main driver behind the latest spike. The war has severely disrupted oil flows through the Strait of Hormuz, a critical shipping route that normally handles about one‑fifth of the world’s oil supply.
And as global crude prices surge, those costs are quickly passed on to consumers at the pump.
“Conflicts in the middle east always cause concern over the availability of oil, and that always creates a higher-priced, more volatile oil market.,” Drew Powers, the founder of Illinois-based Powers Financial Group, told Newsweek. “Yesterday and today, between the US and global oil markets, we are seeing prices from $95 to $119 per barrel. That kind of price action is going to have an immediate and drastic response in gasoline prices at the pump.”
What People Are Saying
President Donald Trump said this week on oil prices: "I actually thought the numbers would be worse. I thought that it would go up more than it did, but we're doing this excursion, and when it's completed, we're going to have a much safer world."
Drew Powers, the founder of Illinois-based Powers Financial Group, told Newsweek: “Yesterday evening, I paid $3.599 at a big-box gas station in the Chicago suburbs. By the time I had driven 3 miles to my house, two gas stations on opposite corners of the same intersection were showing $3.799 and $3.999. Prices above $4 are inevitable.”
Alex Beene, a financial literacy instructor for the University of Tennessee at Martin, told Newsweek: “Simply put, the longer the military conflict in Iran goes on, the more of a financial disaster it becomes for the majority of American households. In the years immediately following the pandemic-era closures, we saw how dramatically rising gas prices boosted costs and lowered buying power. Many prices have remained high since, but one of the few positives for Americans were lower prices at the pump.”
Kevin Thompson, the CEO of 9i Capital Group and the host of the 9innings podcast, told Newsweek: “The longer this war drags on, the more it starts to creep into everyday spending. Gas alone isn’t the issue. Higher diesel costs mean higher transportation costs, and that eventually shows up in food prices and basic goods. Right now, it’s more of an annoyance than a real economic drag, but give it another few weeks and you could start to see some real sticker shock, especially at the grocery store.”
What Happens Next
Gas prices could continue climbing in the coming weeks, particularly if the conflict in the Middle East drags on or further restricts oil shipments.
Even states currently below $4 a gallon are seeing rapid week‑to‑week increases, raising the likelihood that more regions will soon cross that threshold.
“Now that those costs are rising to over $3, and in some states already over $4, we're going to see prices on millions of everyday items also increased to pass along the additional costs of transporting those items,” Beene said. “There are few parts of the economy untouched by the effects of higher gas prices the longer this conflict goes on.”
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