U.S. gasoline prices return to $4 per gallon as oil climbs over 15% in a week

The average price for regular gasoline in the United States reached $4 per gallon on Monday, the first time it has been at that level since mid-June. The increase follows a more than 15% rise in both U.S. crude and Brent crude prices over the past week, with U.S. crude settling at $82.49 per barrel and Brent at $88.10.

Oil markets have been rattled by escalating confrontations between the United States and Iran, as well as ongoing attacks related to the Russia-Ukraine war. The U.S. revoked a sanctions waiver on Iranian oil on July 7 and later announced the end of a ceasefire, prompting a reinstated blockade of the Strait of Hormuz, a key chokepoint for about 20% of global energy shipments.

JPMorgan Chase commodities analyst Natasha Kaneva said Tehran appears to be asserting control over navigation through mandatory transit protocols and fees, creating a standoff that has reduced ship traffic in the strait to a three-week low. Data from MarineTraffic and Kpler showed only eight vessels crossed on Thursday, far below the pre-conflict average of 130 daily crossings.

HSBC analysts noted that the Russia-Ukraine war is also affecting fuel markets, with Russia temporarily halting diesel exports and limiting gasoline and jet-fuel shipments. These restrictions, combined with reduced Russian refining capacity, have tightened global supply.

Since the start of the year, U.S. crude and Brent prices have risen roughly 45%, and jet fuel prices have jumped about 43% to $3.57 per gallon, according to the Argus U.S. jet fuel index.