U.S. economy hit as gas prices surge above $4 and inflation reaches two-year high
Updated
Updated · CBS New York · Apr 25
U.S. economy hit as gas prices surge above $4 and inflation reaches two-year high
12 articles · Updated · CBS New York · Apr 25
Brent crude oil now trades at $105 a barrel, up 44% since the Iran war began, with average U.S. gas prices at $4.06 per gallon and inflation at its highest since May 2024.
Higher energy costs are driving up travel and shipping expenses, likely increasing grocery and goods prices. Disruptions to oil and fertilizer supply chains could keep inflation high, straining consumer budgets and economic growth.
With oil supply crippled, how long until U.S. gas and food prices stabilize?
With fertilizer prices soaring, are American farmers heading for their own crisis?
The world's largest oil disruption is here. How will global supply chains be permanently reshaped?
Can the Federal Reserve fight this inflation without triggering a major U.S. recession?
Could this energy crisis fast-track the global shift away from fossil fuels?
What international efforts can reopen the world’s most critical oil chokepoint?
Geopolitical Conflict Sparks Record 21% Monthly Gas Price Jump and Inflation Spike in U.S.
Overview
In spring 2026, a U.S. naval blockade and Iranian mining of the Strait of Hormuz caused a 70% drop in oil flow, triggering a sharp rise in gasoline prices and inflation across the U.S. Gas prices surged 21% in March, leading to $8.4 billion in extra fuel costs for consumers and widespread increases in shipping, airfares, food, and home energy expenses. Low- and middle-income households faced the greatest burden, cutting back on travel and spending. The Federal Reserve struggled with rising inflation and slowing growth, while global economies risked stagflation. The crisis highlighted the urgent need to diversify energy sources and accelerate the shift to renewables to reduce vulnerability to geopolitical shocks.