US Oil Prices on Track for Continued Disruption as Iran Campaign Enters Week Three

US oil prices remain on track for continued disruption as the US-Israel military campaign against Iran enters its third week, with analysts warning that Monday could be another volatile session. Patrick De Haan, a leading petroleum analyst, has forecast average pump prices of $3.80 to $3.85 per gallon, while noting that $4 gasoline is still a plausible outcome in the near term. The prolonged conflict has created a difficult and uncertain energy environment for American consumers and businesses.
The price surge can be traced directly to February 28, when the first US-Israel strikes against Iran triggered an immediate and persistent rise in oil prices. From below $3 per gallon before hostilities began, the national gasoline average has risen 23% to $3.70 in fewer than three weeks. The sustained nature of the increase has raised concerns that higher prices may persist even after the conflict eventually resolves.
Friday’s US strikes on Kharg Island, a linchpin of Iran’s oil processing and export operations, added to the pressure on a global supply that was already strained. Iran’s ongoing blockade of the Strait of Hormuz—the world’s most important oil shipping corridor, handling around 20% of global supply—has compounded the supply crunch. Brent crude ranged from $103 to $106 per barrel Monday, while US crude held near $94 after briefly spiking to $100 the previous day.
The domestic price impact has been most severe in California, where average pump prices have exceeded $5 per gallon and some Los Angeles stations are posting prices above $8. Nationwide, diesel prices for commercial transportation could reach $5.05 to $5.15 per gallon. The White House has received warnings from Exxon CEO Darren Woods about supply disruption risks and the potential inflationary impact of speculative trading, with similar concerns raised by the leaders of Conoco and Chevron.
Wall Street staged a modest recovery Monday as oil prices temporarily eased, with the S&P 500 rising approximately 1% in early trading. Oil company stocks have surged to record levels since the conflict began. Until the Strait of Hormuz reopens and military operations wind down, US oil prices are likely to remain both elevated and deeply unpredictable.