Middle East turmoil is driving gasoline prices higher

The national average price has risen nearly 10 cents a gallon since last week

By Mark Huffman of ConsumerAffairs

June 24, 2025

• For the second week in a row, the national average price of gasoline has increased, rising 9.7 cents to $3.18 per gallon, according to GasBuddy.

• The national average for diesel spiked 16.1 cents, now sitting at $3.649 per gallon the largest weekly gain since August 2023.

• Rising tensions between Israel, Iran, and U.S. military action are fueling fears of higher oil prices, with experts forecasting continued increases in the coming days.

Gasoline prices have risen over the last two weeks, and the U.S. airstrike on Iran over the weekend appears to be boosting them this week. Data from GasBuddy, compiled from over 12 million individual price reports across more than 150,000 gas stations, show that U.S. motorists are already feeling the impact, with gas and diesel prices climbing significantly over the past few days.

With Israel and Iran trading attacks over the past week, oil prices have continued to climb and gasoline prices are following suit, rising at a pace we havent seen since last summer, Patrick De Haan, head of petroleum analysis at GasBuddy, wrote in the companys blog.

He warned that with the U.S. now directly involved in the conflict, energy markets could remain unstable.

More pain ahead?

De Haan forecasts that gasoline prices could climb another seven to 15 cents this week, while diesel could jump an additional 10 to 20 cents. Despite these alarming increases, he cautions against the exaggerated claims circulating on social media about fuel prices soaring to record levels.

Many of these forecasts are wildly inaccurate, he wrote. Motorists should anticipate a steady, not explosive, rise.

And to be clear, gasoline prices were well below last Junes level before they began to rise.

Still, with geopolitical tensions high and the U.S. now launching strikes against Irans nuclear facilities, market speculation has injected a risk premium into oil prices.

On Monday, both WTI and Brent crude hovered above last weeks levels WTI at $73.78 per barrel and Brent at $76.86 reflecting the markets nervous outlook.

Domestic inventory and refining pressures

Compounding the price pressure is a noticeable tightening in supply. The U.S. Energy Information Administration reported that oil inventories fell by 11.5 million barrels last week, leaving reserves about 10% below seasonal norms.

Refinery utilization also dropped to 93.2%, even as gasoline demand rose to 9.299 million barrels per day.

Gasoline inventories saw only a modest gain of 0.2 million barrels, keeping them 2% below the five-year seasonal average, while distillate inventories (which include diesel) remain 17% below normal levels.

Regional impact – whos paying the most?

The effects are being felt unevenly across the country. States like Michigan (+20.2), Delaware (+13.8), and Texas (+12.4) saw the biggest weekly jumps in gas prices. Diesel prices surged the most in Wisconsin (+28.2), Ohio (+22.9), and Nebraska (+22.7).

At the state level:

• Lowest gas prices: Mississippi ($2.71), Oklahoma ($2.78), Louisiana ($2.80)

• Highest gas prices: California ($4.60), Hawaii ($4.39), Washington ($4.39)

Diesel followed a similar pattern:

• Lowest diesel prices: Texas ($3.19), Mississippi ($3.27), Louisiana ($3.28)

• Highest diesel prices: Hawaii ($5.27), California ($5.07), Washington ($4.80)

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