The conflict in Iran is threatening to hit Americans hard in their wallets, particularly when it comes to gas prices. This comes at a time when the country is already dealing with an affordability crisis. The situation could directly undermine President Trump‘s core promise to keep prices low for consumers.
Trump’s foreign policy decisions have sometimes had unintended effects at home. His steep import taxes, put in place to level the trade playing field, ended up pushing up prices for everyday goods. A similar tension is now playing out with the Middle East conflict.
According to Axios, when crude oil prices rise, Americans feel it quickly at the gas pump. According to Joe Brusuelas, chief economist at RSM, every $10 increase in crude prices typically leads to about a 24-cent hike per gallon for consumers.
Gas prices could reverse Trump’s economic wins and create serious political trouble heading into the midterms
Gas prices are highly visible, posted on signs everywhere, and act as a strong signal about the cost of living, both politically and in people’s minds. If prices spike, it will put more pressure on American budgets and could sour their feelings about the economy.
Historically, over the past 50 years, when gas prices went up, people’s overall inflation expectations tended to follow. Reports show that Trump’s advisers warned the Iran war would be catastrophic, but those warnings went unheeded.
NEW YORK (AP) — The average price for a gallon of gasoline jumped 11 cents overnight to about $3.11 in the US, according to AAA.
— Geoff Bennett (@GeoffRBennett) March 3, 2026
For a while, lower gas prices were actually helping President Trump by acting as a “deflationary tailwind.” Back in January, prices were down over 7% compared to the previous year, which helped keep overall inflation in check. But with the turmoil in the Middle East, that trend could now flip.
Mark Malek, chief investment officer at Muriel Siebert, recently noted that there was already a serious conversation about whether inflation was “sticky or merely stubborn.” He believes a lasting energy shock could completely change that narrative, pointing out that energy costs feed into transportation costs, and transportation costs feed into goods prices.
Fox: The price of oil has reached $76 a barrel. And the price of gas, woah, that is way up. $3.10 is the average price of a gallon, up about 11 cents overnight. Natural gas up about 5.8%. This is not helping stocks. pic.twitter.com/LI0zKhxxf7
— FactPost (@factpostnews) March 3, 2026
It is not just gas prices, either. The demand for electricity, driven by AI, is pushing up utility bills across the country. Grocery prices have already jumped. The White House has also promised to use other trade authorities to reimpose tariffs that the Supreme Court had rejected. Meanwhile, Trump has called the Iran power handover a success, despite all US-backed leaders being dead.
Voters are already concerned about the economy and affordability. Brian Gardner, chief Washington policy strategist at Stifel, highlighted that if oil prices see a sustained increase, it could create a significant risk for Republican candidates in the upcoming November elections.
