TLDR
- The national average gas price hit $4.0030 per gallon on Monday, crossing the $4 threshold for the first time since June
- Prices are up more than 30% since the U.S. and Israel attacked Iran in late February
- A ceasefire deal signed in June briefly pushed prices below $4, but that truce collapsed in early July
- Brent crude rose 3.2% to $90.95 per barrel and U.S. crude climbed 2.8% to $84.04 on Monday
- Low U.S. fuel inventories, sitting around 1.5 million barrels below the five-year average, are adding further pressure
U.S. drivers are back to paying $4 a gallon at the pump, and the renewed fighting between the U.S. and Iran is the main reason why.
BREAKING: 🇺🇸US average retail gas prices hit $4 per gallon for the first time since June 17, per AAA. pic.twitter.com/BB3TUi6WcL
— Coin Bureau (@coinbureau) July 20, 2026
The national average for a gallon of regular gasoline reached $4.0030 on Monday, according to the American Automobile Association. A year ago, the average was $3.14 a gallon.
Gas prices first crossed $4 in late March after Iran halted traffic through the Strait of Hormuz. That strait is a narrow waterway that carries about 20% of global oil supplies.
Prices eased in June when the U.S. and Iran signed a memorandum of understanding to end the war. But that deal fell apart in early July, and fighting has since resumed.
Crude oil prices surged about 16% this week following the collapse of the truce. Retail gas prices and crude oil tend to move in the same direction because crude is the main cost in producing fuel.
Oil Markets React to Renewed Conflict
Brent crude, the international benchmark, rose 3.2% to $90.95 per barrel on Monday. U.S. benchmark crude climbed 2.8% to $84.04 per barrel.
The Strait of Hormuz remains central to the price pressure. Any disruption to traffic through it sends shockwaves through global energy markets.
🇺🇸NOW: PRESIDENT TRUMP ADDRESSES ESCALATING IRAN CONFLICT
"We are now doing a FAR bigger job, we were on a little job stopping them from having a certain capability"
"But now, we're just ENDING it"
"Ending any chance where they can have a nuclear missile.
"If you look at it,… pic.twitter.com/QE4lEMEwz5
— Coin Bureau (@coinbureau) July 20, 2026
Energy prices have also been pushed higher by Ukraine stepping up attacks on Russian refining infrastructure, which has reduced Russian refining capacity.
Inventory Shortfalls Add More Pressure
U.S. fuel stockpiles stood at 210.5 million barrels last week, about 1.5 million barrels below the five-year average. Low inventories reduce the buffer against supply shocks.
Gas prices vary by state due to differences in local supply, taxes, and distribution costs. Some states have been above $4 for considerably longer.
The $4 mark is widely seen as a pressure point for household budgets. Higher gas prices also tend to push up costs for groceries and other goods that rely on fuel for transport.
High pump prices have become a political issue for President Donald Trump and the Republican Party. Republicans are heading into November midterm elections where they need to defend thin majorities in Congress.
Trump had previously expressed frustration that gas prices were not falling as fast as oil prices when the June truce was in place.
The $4 average is a national figure. Drivers in high-cost states like California have been paying well above that for months.
With no new ceasefire deal in sight, analysts see little relief coming at the pump in the near term. The latest escalation between the U.S. and Iran pushed oil prices sharply higher on Monday, dragging fuel costs with them.
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