U.S. Gas Prices Hit $4 as Iran Conflict Closes Strait of Hormuz

The U.S. national average gasoline price returned to $4 per gallon on July 20, 2026, following a resurgence of hostilities between the United States and Iran. The price surge follows the collapse of a provisional peace agreement signed in June and subsequent retaliatory U.S. military strikes against Iran, launched after an attack on a military base in Jordan killed two American service members.

Conflict in the region has left the Strait of Hormuz largely unnavigable, disrupting approximately 25% of global oil movement. This supply shock, combined with Ukrainian attacks on Russian refineries and strong summer travel demand, has pushed Brent crude prices to approximately $86 a barrel. Regional impacts vary across the U.S., with California prices reaching $5.50 per gallon while Indiana remains the lowest at $3.35.

Donald Trump has urged retailers to lower prices toward $2.50 per gallon and directed the Department of Justice to investigate potential price gouging by oil companies. Energy Secretary Chris Wright announced that the administration is pivoting to ensure the recovery of oil flows through the Strait of Hormuz, regardless of Iranian cooperation. Analysts from the American Automobile Association and GasBuddy indicate that drivers should expect continued volatility as global refining capacity remains strained and U.S. fuel inventories sit 1.5 million barrels below the five-year average.