US gasoline prices have climbed to their highest levels ever recorded for the month of August, driven by the ongoing blockade of the Strait of Hormuz and crude oil trading above $90 a barrel as diplomatic efforts to end the Iran war stall.
The national average for a gallon of regular gasoline has surged past $4.20, according to AAA data, surpassing the previous August record set in 2008 during the last major oil price spike. The increase comes as tanker traffic through the Strait of Hormuz, through which roughly 20% of global oil supplies normally flow, has ground to a near standstill since the US-Israel military campaign against Iran began in late February.
Oil Majors Post Record War-Period Profits
Eight of the world’s largest oil companies have collectively amassed approximately $90 billion in profits since the conflict began, according to a Guardian analysis of quarterly filings. Saudi Aramco, BP, Shell, Equinor, TotalEnergies, Eni, Chevron, and ExxonMobil have all reported record or near-record earnings, benefiting from elevated crude prices while consumers bear the brunt at the pump.
The windfall has drawn sharp criticism from consumer advocates and lawmakers. “These companies are posting historic profits while American families pay historic prices at the gas station,” said one congressional Democrat who asked not to be named ahead of planned legislation targeting oil industry pricing practices.
Crude Oil Back Above $90 as Stalemate Continues
Brent crude, the international benchmark, rose to $91.53 per barrel on Monday, up 86 cents from Friday’s close and roughly 39% higher than a year ago. West Texas Intermediate traded near $84. The 60-day memorandum of understanding between Washington and Tehran expired over the weekend with no extension in sight, and President Trump has escalated rhetoric by threatening strikes on Oman over its diplomatic engagement with Iran.
The Strait of Hormuz remains effectively closed to commercial shipping, with the few vessels that do transit doing so under enormous insurance surcharges. LNG tankers have also been targeted, with a Qatari gas carrier struck by a projectile earlier this month, marking an expansion of the conflict’s impact beyond crude oil into the liquefied natural gas supply chain that powers power plants and industry across Europe and Asia.
Analysts at Goldman Sachs project that gasoline prices could reach $4.50 per gallon nationally if the Hormuz disruption persists through September, with some metropolitan areas already exceeding $5. The EIA’s latest forecast puts the 2026 average at $3.90 per gallon, though that projection was made before the most recent escalation.
For consumers, the pain extends beyond the pump. Higher diesel prices feed into transportation and logistics costs, raising prices for groceries, goods, and services. The National Retail Federation warned last week that back-to-school shopping costs could rise 5-8% compared to last year, partly attributable to fuel-driven supply chain expenses.
Sources: The Guardian; AAA; Trading Economics; US Energy Information Administration; Goldman Sachs commodities research
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