On the campaign trail in 2024, President Donald Trump pledged to restore low petrol prices and attributed the unprecedented surge in petrol costs to the Biden-Harris administration’s “war on energy.” However, an actual war intervened: Trump’s profoundly unpopular conflict with Iran. Nearly eight months into a conflict that has disrupted the global energy landscape, the average price of petrol during Trump’s second term has surpassed the levels observed during the Biden administration, as per an analysis of AAA data. That milestone – a nearly unthinkable outcome as recently as January – highlights the growing frustration over elevated prices that has permeated Trump and the Republican party in the lead-up to the midterm elections. “It’s pretty astonishing,” Patrick De Haan said of the fact that gas is now more expensive under Trump than former President Joe Biden. “I don’t think anyone would have predicted this 10 months ago.” It represents a significant shift from the anticipated return to sub-$2 petrol that Trump assured during the summer of 2024, as he effectively persuaded voters to reinstate him in the White House. During his first term, the national average for regular petrol stood at $2.47 per gallon. In April 2020, amidst the severe economic disruptions caused by the Covid-19 pandemic, national petrol prices fell to a low of $1.77.
The health emergency precipitated a collapse in fuel demand, resulting in a situation where global storage capacity for oil was exhausted, a rare occurrence that temporarily pushed crude oil futures into negative territory for the first time in history. In April 2020, Trump made a request to Saudi Arabia and Russia to reduce their oil production in order to prevent a market crash that posed a significant risk to the financial stability of US oil companies and the preservation of numerous jobs. The circumstances are markedly distinct today. The White House has engaged in a concerted effort to mitigate the repercussions of elevated fuel prices through a variety of measures, which include providing farmers with a $8 billion financial support package, purchasing millions of barrels of Russian diesel, and exploring strategies to reduce significantly high shipping costs. “President Trump is fixing these long-term problems by taking tangible steps to increase our refining capacity here in the United States, while also taking immediate actions, such as releasing oil from our (Strategic Petroleum Reserve) to add supply to the market, temporarily waiving the Jones Act, and allowing red-dyed diesel for highway use, to lower prices at the pump,” White House spokesperson Taylor Rogers told.
The outlook for petrol and diesel prices appeared quite favourable for Americans at the beginning of the year. Petrol prices remained comfortably under $3 a gallon, and, if anything, the energy market expressed concerns about a potential supply glut that could maintain low fuel prices. “If Trump really wanted to keep his promise to keep gas prices low, what he should have done was nothing,” said Gregory Brew. “The market was oversupplied. There was a lot of crude sloshing around. Inventories were quite large. But Trump reversed that with the war.” Trump has contended that high petrol prices represent a minor cost in the effort to prevent Iran from acquiring a nuclear weapon. However, the increase in petrol prices has frustrated voters who anticipated a different outcome under Trump. “High gas prices do not bode well for incumbents. They didn’t bode well for Biden either,” De Haan said. Petrol prices surged significantly during Biden’s administration, reaching a record high of $5.02 per gallon in June 2022 following Russia’s invasion of Ukraine. However, petrol prices declined more rapidly during the Biden administration. In fact, 2026 has already surpassed the Biden-era record for the highest number of days with petrol prices at $4 or above.
The conflict with Iran resulted in a scenario previously deemed inconceivable: the unparalleled shutdown of the Strait of Hormuz, the critical passage through which global oil supplies from the Middle East are transported. Although oil transportation through the Strait of Hormuz has mostly rebounded, the expenses associated with extracting that crude have surged due to costly and inefficient alternative methods being employed. The cost of hiring an oil tanker has surged dramatically from $65,000 a day last year to $1.6 million earlier this month. Furthermore, the global economy is currently facing a significant shortage in refining capacity. Refineries that typically produce diesel, jet fuel and petrol have sustained damage in the Middle East and Russia. China has restricted its fuel exports. In response to diminished refinery production, global markets have resorted to utilising both commercial and emergency fuel reserves. However, this renders the complex energy system susceptible to disruptions. Case in point: A recent, unexpected outage at ExxonMobil’s Joliet, Illinois, refinery led to a significant increase in petrol prices across Michigan, Ohio and other Great Lakes states in recent days. “Right now, there is no cushion. Commercial inventories are very low,” said Brew. “When there is any kind of outage, everyone starts to scramble.”
Refiners, motivated by the opportunity to generate substantial profits amid the shortage, are maximising fuel production despite the typical seasonal slowdown for routine maintenance. “Refiners have been running flat-out for months. If you own a refinery, you are printing money. Some are skipping maintenance because there is money to be made right now,” said Brew. “But if you run refiners for months on end, they will break down.” Once the Exxon refinery resumes standard operations, petrol prices are expected to decline. However, that relief will likely be counterbalanced by the reality that oil prices have escalated to seven-month highs as traders prepare for the potential risk of a return to full-scale conflict in the Middle East following the election. De Haan said Trump is “pulling every small lever he can” to cushion the blow from high prices. “Unfortunately, they’re not adding up to much,” he said. “Until the biggest lever – diplomacy – is pulled, he’s going to continue to fight against very elevated gas and record diesel. It’s fairly ominous.”
