In California, gas prices reached a staggering $5.91 on Tuesday
The energy supply shock stemming from the Iran war has hit US gasoline prices hard, with the average price per gallon surpassing $4 yesterday for the first time in four years, according to AAA.
Since the US and Israeli strikes on Iran began on February 28, prices at the pump have surged by over 30%. Diesel prices are up more than 40% to over $5 a gallon, affecting the broader US economy. In California, prices reached a staggering $5.91 on Tuesday.
The ongoing war has led to the closure of the Strait of Hormuz near Iran, a critical maritime artery that typically handles 20% of global oil supplies. The disruption is so significant that the International Energy Agency has classified it as the largest oil supply interruption in history.
In response, the Trump administration has activated several emergency measures.
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The EPA is temporarily lifting summer smog regulations to permit the sale of E15 fuel blends.
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The US is preparing to release 172 million barrels of oil from its petroleum reserves, and has lifted sanctions on Russian oil.
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The Trump administration has waived the Jones Act for 60 days to allow foreign vessels to assist in domestic fuel transport.
Despite these efforts, analysts warn that consumer prices for groceries, online deliveries, and more will likely rise by April.