U.S. gas prices jump 11 cents overnight in record spike — White House swears it has a plan

Gas prices spiked the most since 2022

The national average for regular gas jumped about 11 cents overnight Tuesday, landing near $3.11 a gallon, according to AAA. That made it the biggest single-day jump since Russia invaded Ukraine in March 2022.

Prices were already creeping up before the conflict started because refineries had begun switching to pricier summer-blend fuel.

Crude oil drives more of what you pay at the pump than anything else, so when barrels get expensive, you feel it fast.

The Strait of Hormuz is the bottleneck

The Iran conflict threw a wrench into one of the world’s most important oil routes.

The Strait of Hormuz handles roughly 20% of global oil shipments, and the fighting has scared off shipping companies and insurers.

Some major insurers pulled coverage for ships in the Gulf entirely, and war-risk insurance costs shot up.

U.S. benchmark crude (WTI) climbed about $10 a barrel after strikes began, while international benchmark Brent crude pushed past $80.

Rubio said a plan was already in place

Secretary of State Marco Rubio told reporters Monday that the administration saw the price spike coming before strikes started.

He said Energy Secretary Chris Wright and Treasury Secretary Scott Bessent would begin rolling out a plan Tuesday to soften the blow for American consumers.

Rubio kept the details under wraps at the time, but he made clear the White House had prepared for this. The announcements started coming the next day.

Trump ordered insurance and Navy escorts

On Tuesday, President Trump told the U.S. International Development Finance Corporation (DFC) to offer political risk insurance for oil tankers and cargo ships in the Gulf.

He also said the Navy would escort tankers through the Strait of Hormuz if needed. Markets responded quickly, with stocks recovering from steep losses and oil prices pulling back from their highs.

The move has history behind it: during the Iran-Iraq conflict in the 1980s, the U.S. reflagged tankers and sent Navy escorts when private insurers backed out.

Bessent promised more steps are coming

Treasury Secretary Bessent went on CNBC Wednesday and said the DFC insurance was just the beginning. He said the administration plans a series of additional announcements to keep oil moving through the Gulf.

Bessent argued that global crude markets have enough supply right now and that the administration is working with energy-producing nations through the International Energy Agency (IEA).

Oil prices dropped Wednesday for the first time since the war began, partly because of his comments.

The oil reserve sits at half capacity

The U.S. Strategic Petroleum Reserve (SPR) holds about 415 million barrels of crude right now, a little over half of what it can store. The administration has not tapped it and has no immediate plans to.

But officials could signal they are willing to use it if prices keep climbing.

If the order came, the Department of Energy could start delivering SPR oil to the market within 13 days, at a rate of up to about 4.4 million barrels per day.

Trump previously criticized President Biden for using the reserve during the 2022 price spike.

Analysts expect prices to keep climbing

Tom Kloza, chief oil analyst at Gulf Oil, expects the national average to peak somewhere between $3.25 and $3.50 a gallon in the coming weeks, with western states paying more.

Patrick De Haan of GasBuddy projected a 10- to 30-cent increase over the following week but said $4 gas is unlikely right now.

According to Federal Reserve Bank of Dallas research, a $10-per-barrel jump in crude oil typically adds about 25 cents a gallon at the pump within 20 working days.

A longer war could push oil past $100

JPMorgan analyst Natasha Kaneva warned that if fighting lasts more than three weeks, Gulf oil-producing nations could run out of storage space and have to cut production.

Under that scenario, Brent crude could hit $100 to $120 a barrel.

Gulf nations have about 343 million barrels of onshore crude storage, enough for roughly 22 days if exports stop.

Bank of America’s Francisco Blanch said Brent could top $100 if Iran targets neighboring energy facilities but could fall back to $60 to $70 if hostilities end quickly.

This looks different from the 2022 spike

When Russia invaded Ukraine, oil surged 50% in weeks and gas hit a record $5.02 a gallon by June 2022. Analysts say global supply is in better shape now.

OPEC+ nations ramped up production through 2025, and the U.S. is now a net energy exporter, which gives the country some cushion against global shocks.

Kloza noted there is more crude available worldwide than there is demand, even with the disruption. One key difference: the U.S. started this conflict, so Washington controls the timeline.

Diesel and jet fuel add more pain

Gas is not the only fuel getting more expensive. Kloza projected diesel could reach $4 or more a gallon in the second quarter.

That matters beyond the pump because higher diesel costs raise the price of shipping goods by truck, which can push up grocery and retail prices.

Jet fuel prices have also jumped, which could mean pricier airline tickets.

Economists warn that sustained oil price increases tend to ripple into transportation, manufacturing, and consumer goods.

Several factors are working to limit damage

U.S. gasoline supplies were solid heading into the conflict, and the global crude market had a surplus before the war. Both of those act as a cushion.

The administration’s insurance and escort measures aim to get tankers moving through the Gulf again.

The IEA has signaled it is ready to help stabilize markets, and coordinated emergency reserve releases from multiple countries remain an option if disruptions drag on.

The conflict timeline matters most

How long the fighting lasts is the single biggest factor for fuel prices, according to multiple analysts. If it ends within days or weeks, prices could settle back toward where they were before.

If the Strait of Hormuz stays blocked for an extended stretch, sharper increases become much more likely.

Drivers should also keep in mind that gas prices typically peak around mid-April due to seasonal demand, so the conflict’s timing adds pressure to an already rising trend.

This article was created with AI assistance and human editing.

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