US oil prices surged this week, nearing a five-month high, as President Donald Trump weighed the possibility of entering the growing conflict between Israel and Iran. Analysts say the continued rise in oil prices will likely lead to higher gasoline prices for American drivers within days.
West Texas Intermediate (WTI), the US benchmark for crude oil, has jumped more than 20% in June alone. The increase follows a series of missile strikes exchanged between Israel and Iran, which have raised concerns about a wider war in the Middle East.
The Middle East produces a significant portion of the world’s oil. Any disruption there can send prices soaring. If the conflict worsens or spreads to other countries, experts warn that oil prices could rise dramatically.
Currently, the national average for a gallon of gasoline is $3.19, a seven-cent increase from last week. Gas prices have risen in 49 out of 50 states, according to market analysts. California was the only state to see a slight drop, due in part to recent improvements at local oil refineries.
Experts believe gas prices could rise to around $3.40 per gallon in the coming weeks, which would be a 6% increase. However, a much larger spike could happen if the conflict disrupts oil shipping routes or damages production facilities.
Richard Joswick, an energy analyst, said a full-blown conflict might trigger only a short-term spike in oil prices—unless there is serious damage to oil infrastructure or key trade routes.
That danger is growing. Overnight strikes between Israel and Iran entered their sixth day on Wednesday. Israel’s initial attack on Friday targeted key Iranian nuclear sites, killing several high-ranking officials, including nuclear scientists and military commanders.
Though the US did not assist in that attack, President Trump has said it is “possible” the US may get involved soon. That statement alone has been enough to rattle global markets and energy investors.
Ramanan Krishnamoorti, a petroleum expert at the University of Houston, said the potential fallout could be massive. Iran produces around 3% of the world’s oil and controls access to the Strait of Hormuz—a narrow waterway through which about 20% of all global oil is transported.
If the conflict interferes with tanker traffic in the Strait, oil prices could skyrocket from the current $73 per barrel to as much as $120 per barrel, Krishnamoorti said. That’s a jump of over 60%. Gasoline prices would likely surge in response, possibly topping $5 per gallon nationwide.
“If we see any throttling back of the Strait of Hormuz, we’ll see a massive increase in the price of oil,” Krishnamoorti said. “And that will impact everything in the US.”
That outlook is shared by financial analysts, who fear the fighting could soon spread to oil facilities in the Gulf. Asset management firms have warned investors of potential strikes on energy infrastructure or temporary blockades of vital shipping lanes.
Still, the future is uncertain. Prices may continue to rise slowly if the fighting does not spread. But Krishnamoorti cautioned that this might only be the beginning. “We may have just seen the tip of the iceberg in terms of price hikes,” he said.
If tensions cool, price increases may level off. But for now, drivers should expect rising costs at the pump, especially ahead of the busy July 4th holiday.
