U.S. Gas Prices Surge Amid Conflict in Iran, Potentially Offsetting Tax Refunds

2026-03-19

The BareStory

Global oil and United States gasoline prices have spiked following the outbreak of war in Iran and subsequent shipping disruptions in the Strait of Hormuz. The international benchmark, Brent crude, rose to approximately $111 a barrel, while United States crude increased to over $99. Domestically, the national average price for a gallon of gasoline surged by nearly a dollar over the past month, reaching over $3.80.

The market fluctuations stem from ongoing military conflict and supply chain disruptions in the Middle East. Amid the escalation, Iranian officials threatened to attack oil and gas infrastructure in Saudi Arabia, Qatar, and the United Arab Emirates, claiming their own facilities had been targeted. In an effort to ease domestic energy costs, President Donald Trump issued a 60-day waiver of the Jones Act to loosen maritime shipping restrictions and delayed an upcoming trip to China.

The rising fuel costs are projected to offset financial gains taxpayers were slated to receive from recent tax legislation. According to the nonpartisan Tax Foundation, individual tax refunds are expected to increase by an average of $748 this year due to the newly implemented One, Big, Beautiful Bill Act. However, economists at the Stanford Institute for Economic Policy Research estimate the average American household will spend an additional $740 on gasoline this year, assuming the Strait of Hormuz remains blocked for three weeks.

Analysts suggest the ultimate financial impact on consumers depends heavily on the conflict's duration. One petroleum expert noted that the Jones Act waiver is a temporary measure unlikely to significantly lower gas prices, as global markets remain focused on whether further regional threats will materialize.

Left Perspective

Erasing Hollow Tax Victories
Deploying Ineffective Deregulatory Band-Aids
Anchoring Consumers to Volatility

Right Perspective

Absorbing Global Supply Shocks
Pivoting to Deregulatory Agility
Leveraging Vital Shock Absorbers

Left Perspective

• Erasing Hollow Tax Victories The heralded financial gains from the "One, Big, Beautiful Bill Act" are exposed as illusory for working families when subjected to the volatility of global commodities. A projected $748 average tax refund increase is instantly negated by the estimated $740 in extra gasoline costs households will shoulder if the Strait of Hormuz remains blocked. This demonstrates the inherent weakness of economic frameworks that prioritize top-down tax cuts rather than building resilient domestic systems insulated from fossil fuel shocks.

• Deploying Ineffective Deregulatory Band-Aids Suspending maritime shipping regulations serves as political theater rather than providing tangible, structural relief to struggling consumers. President Trump’s 60-day Jones Act waiver is actively assessed by petroleum experts as a temporary measure unlikely to meaningfully reduce the $3.80 per gallon pain at the pump. Stripping away shipping standards under the guise of crisis management provides cover for market extraction while failing to protect citizens from soaring energy costs.

• Anchoring Consumers to Volatility The economic security of everyday Americans is far too vulnerable to the whims of international conflict and corporate supply chains. With Brent crude spiking to $111 a barrel due to regional hostilities and threatened attacks on Saudi, Qatari, and UAE infrastructure, domestic consumers are forced to bear the ultimate financial burden. The administration’s purely reactive posture highlights the extreme peril of remaining tethered to an unpredictable global oil market where foreign conflicts easily wipe out personal wealth.

Right Perspective

• Absorbing Global Supply Shocks Domestic energy pricing is inevitably bound to international supply disruptions, requiring a pragmatic, data-driven acceptance of global market forces. The surge of Brent crude to $111 and US crude to over $99 is the direct, mathematical result of military conflict in Iran and the consequent shipping bottleneck in the Strait of Hormuz. Rather than a failure of domestic policy, this near-dollar surge to $3.80 per gallon reflects the hard reality of global supply constraints during an active war.

• Pivoting to Deregulatory Agility Executive interventions must prioritize supply chain fluidity and market efficiency to navigate sudden geopolitical emergencies. President Trump’s 60-day waiver of the Jones Act represents a targeted, pro-market lever to bypass bureaucratic maritime restrictions and accelerate domestic energy distribution. Delaying the scheduled China trip to manage this crisis demonstrates a necessary prioritization of rapid, executive-driven logistical maneuvering to mitigate further cost spikes.

• Leveraging Vital Shock Absorbers Pro-growth fiscal policies function as essential financial buffers for citizens during unavoidable international crises. While Stanford economists estimate a $740 increase in household gas costs if the Strait remains blocked for three weeks, the $748 average tax refund generated by the "One, Big, Beautiful Bill Act" effectively neutralizes consumer devastation. Preemptively returning capital to taxpayers creates systemic stability, proving that supply-side tax retention is the most reliable defense against unforeseen global instability.

How it may affect me

As a U.S. reader:

• In the short term, you will pay significantly more for fuel, as the national average for a gallon of gasoline has already increased by nearly a dollar to over $3.80.

• Your anticipated average tax refund increase of $748 will likely be entirely offset by extra gasoline costs, which are estimated to reach $740 per household this year if the Strait of Hormuz remains blocked for three weeks.

• You should not expect immediate price relief from the government's 60-day waiver of the Jones Act, as experts indicate this temporary shipping deregulation is unlikely to meaningfully lower consumer gas prices.

• In the long term, your future household energy costs will depend directly on the duration of the global conflict and whether threatened attacks on additional oil infrastructure in Saudi Arabia, Qatar, and the United Arab Emirates actually materialize.

U.S. Gas Prices Surge Amid Conflict in Iran, Potentially Offsetting Tax Refunds

The BareStory

Left Perspective

Right Perspective

How it may affect me

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