Why $3 Gas Won’t Return Soon — Even With an Iran Truce

The average gasoline price in the United States has climbed to about $4.15–$4.17 per gallon and remains elevated, despite hopes that a temporary ceasefire with Iran would bring relief.

A driver fills up at a gas station as US fuel prices remain elevated.

Prices were already rising before Donald Trump announced the truce, reaching roughly $4.14 per gallon, according to data from AAA, as reported by Andrew Romano for Yahoo News.

Many Americans had hoped the two-week ceasefire, intended to allow negotiations toward a longer-term agreement, would push prices back below $3 per gallon, levels seen before the US and Israel’s conflict with Iran escalated in late February.

A key factor has been the disruption of oil flows through the Strait of Hormuz, a critical chokepoint that handles roughly one-fifth of global oil supply.

However, analysts say a rapid drop in prices is unlikely. “There’s no going back to what we had — at least not this year,” said Mark Zandi, chief economist at Moody’s Analytics.

Global oil prices are largely benchmarked against Brent crude, a North Sea oil standard traded on futures markets.

Traders price in expectations about future supply and geopolitical risks. When Iran restricted shipping through the Strait of Hormuz, prices surged. Even if flows resume, uncertainty about security and enforcement continues to keep prices elevated.

In addition, the strait has not fully returned to normal operations, and markets remain skeptical about how durable any reopening might be.

As a result, gasoline prices are unlikely to fall sharply in the near term, even with a temporary pause in hostilities.