Will US gas prices go up in 2026?

US gas prices went up sharply in 2026: the AAA national average rose from $2.98 on February 26 to a peak of $4.55 on May 21, eased to a $3.83 low on July 2, then whipsawed repeatedly through the summer as the war ran through cycles of diplomatic progress and reversal. The pump price has held remarkably steady through all of it: AAA sits at approximately $4.01/gallon in mid-August, little changed even as Iran and Oman appear to be edging closer to a Hormuz route deal while fresh vessel attacks continue. GEF holds the scenarios built around this pattern: the base case (~40%) is a sustained high-tension standoff -- neither side's moves fully resolve or fully escalate the situation -- grinding to about $4.40/gallon by year-end. A de-escalation case (~20%) eases to about $3.75 if a genuine, lasting stand-down takes hold. An escalation case (~35%, up from ~35%) sees a further kinetic event push prices to about $5.75, further EXCEEDING the 2022 record of $5.00.

How high will US gas prices get in 2026?

The 2022 historical peak of $5.00/gallon (one-week record, June 2022) is the natural reference point — and GEF's escalation scenario now projects further EXCEEDING it. Three scenarios for December 2026: $3.75 (de-escalation, ~20%, a genuine and lasting US-Iran stand-down takes hold), $4.40 (sustained high-tension standoff, the base case ~45%, the pattern of brief pauses followed by fresh strikes continues without a decisive move either way), and $5.75 (escalation, ~35% -- a further kinetic event, of the kind that already occurred on Jul 28 when Iran's IRGC launched a surprise missile attack on US forces). The peak so far in 2026 was $4.55 on May 21, but the current trajectory -- a pause that lasted only 3-4 days before a surprise missile attack reopened the direct US-Iran military channel -- means the escalation case remains a live, not a minority-tail, possibility relative to the base case, given the pattern of repeated re-escalation cycles through 2026.

Is the United States running out of oil?

No. The US is the world's largest oil producer (13.6 million barrels per day in 2025) and was running a multi-year refill of the Strategic Petroleum Reserve when the Iran conflict began. What is happening is a rapid drawdown of the SPR — the federal emergency buffer designed to be used in exactly this kind of supply shock. As of the latest available data (week ending July 10, final EIA figure), the SPR sat at approximately 316.5 million barrels — down about 3.0 million on the week, roughly 98.9 million barrels since the war began on February 28, and the lowest level since April 1983, now below even the 2023 drawdown low. Commercial crude oil (a separate, non-emergency stockpile) drew 1.7 million barrels the same week. The reserve is functioning as designed; the analytical question is when the drawdown rate has to slow because of physical floor mechanics, not whether the country is running out of oil.

When will the US Strategic Petroleum Reserve run out?

The SPR cannot literally 'run out' because of how it is engineered — the four salt-dome storage sites in Texas and Louisiana have hydraulic limits that prevent maximum-rate pumping below roughly 250 million barrels. Below that level, you can still draw oil, but not as fast, and the buffer effect on crude prices weakens substantially. The level sits at 298.7 million barrels (DOE data, Aug 12) — below 300 million for the first time since January 1983, a multi-decade low -- just ~54.8 million barrels above the ~250 mbbl floor -- even as commercial crude (excl. SPR) posted a 17.4 million barrel build for the week ending Aug 7, the largest since Jan 2023. GEF's scenarios: the de-escalation case (~20%) sees the draw bottom out before a partial refill begins, ending near 325 mbbl by December 31; the base-case sustained high-tension scenario (~40%) sees continued drawing to about 265 mbbl; the escalation case (~35%) sees the reserve breach the ~250 mbbl operational floor more deeply, ending near 235 mbbl.

Why aren't US gas stations rationing fuel?

Because US gas-supply stress is operating as a price phenomenon rather than a physical-shortage phenomenon. There is no decree from Washington restricting how much fuel an individual driver may buy, no station-level allocation caps, and no queues comparable to the 1973–74 oil crisis. The mechanism currently in operation is price rationing — pump prices rise until enough demand is destroyed (people drive less, airlines adjust capacity) to balance the available supply. The IEA's Fatih Birol has described this as a 'rationing function.' Physical rationing risk has historically been more concrete in parts of Europe and Asia, though the picture there is also easing as Hormuz transit normalizes; see the EU and individual-country shortage pages for current status.

How much does gas cost in California vs Oklahoma right now?

State-level pump prices diverge sharply across the US in 2026. The most expensive state remains California at about $5.71/gallon, with Hawaii, Washington, Nevada and Oregon also well above average. The cheapest are in the Gulf and lower-Midwest band — Oklahoma, Mississippi, Louisiana and Texas — around $3.98–$4.02/gallon. The spread between California and the cheapest states is therefore roughly $1.70/gallon — a bit under half the national average price. State-level taxes, environmental regulations (California's CARB-spec gasoline costs more to refine), refining capacity, and pipeline access are the structural drivers of the regional differential.

Shortages United States 2026 Forecast

US Gas Prices & the SPR Buffer — 2026 Three-Scenario Forecast

AAA national-average pump price plus the Strategic Petroleum Reserve drawdown, side by side. Three paths to December: de-escalation, sustained standoff, or escalation. Today: $4.1044/gallon (Aug 21), still climbing after a brief dip to $4.01 on Aug 10; SPR at 298.7 mbbl (last confirmed Jul 31), a multi-decade low, even as commercial crude posted its largest weekly build since Jan 2023. The base case -- sustained high-tension standoff -- remains the operative read: Iran and Oman appear to be edging closer to a Hormuz route deal, but fresh vessel attacks continue and the diplomatic track has not yet resolved into anything physical.

Forecast Revised August 16, 2026

US live status Disruption map State prices Airlines Timeline 2026 Forecast

US gas prices and the Strategic Petroleum Reserve in 2026: observed to July 16, plus three rebuilt forecasts to year-end

Two charts, same x-axis. The top chart is the AAA national-average pump price — what readers actually pay. The bottom chart is the Strategic Petroleum Reserve — the federal emergency buffer that has been muffling crude price spikes from reaching the pump in full. AAA held remarkably steady through a genuinely volatile stretch -- a direct US strike on Iran, a Hormuz route understanding, stricter-than-expected Iranian terms, an outright denial of active talks, and now signs of renewed progress on routes specifically -- dipping to $4.01 on Aug 10 before climbing back to $4.1044 by Aug 16 and $4.1044 by Aug 21. GEF holds the scenario weights built around exactly this kind of pattern: a sustained high-tension standoff is the base case (~40%), de-escalation sits at (~20%), and escalation (~35%) reflects the pattern of repeated re-escalation this year. Underlying data: AAA $4.1044 (Aug 21), SPR 298.7 mbbl (DOE, Aug 12, a multi-decade low).

GEF's own AIS audit is the reason not to overcorrect in either direction despite the news cycle: through this whole stretch -- direct strikes, a strike-deferral announcement, a route agreement, and now stricter-than-expected parliamentary terms -- the Hormuz persistent core has kept holding on GEF's own tracking, with no confirmed fresh closure signal or confirmed reopening at the strait itself. Price and the diplomatic story have both moved far faster than the physical picture at Hormuz. The SPR's role as a price-shock absorber remains strained: it now sits at 298.7 mbbl (DOE data, Aug 12), below 300 million barrels for the first time since January 1983 — a fresh multi-decade low, even as commercial crude unexpectedly built the same week.

December 2026 endpoint range — AAA national average ($3.75 de-escalation → $5.75 escalation, base case $4.40)

Today (Jul 28 print, reviewed Jul 29) — observed

$4.10

AAA national average. Brent settled $84.09 Tue Jul 28 (-4.8% d/d, capping a 3-day ~16% slide), then jumped back toward $87 Wed after Iran's surprise missile attack on US forces shattered the pause. State extremes: California $5.57, Indiana $3.53 (Jul 23 breakdown).

Scenario 1 — De-escalation

$3.75

OPTIMISTIC CASE (~20%). A genuine, lasting US-Iran stand-down takes hold this time -- unlike the 3-4 day pause that just broke -- and Brent eases back toward the $70s-80s. Pump price drifts down from today's $4.10 but does not close the gap to the $2.98 pre-conflict floor, given the accumulated damage to the framework. Year-end ~$3.75.

Scenario 2 — Sustained high-tension standoff

$4.40

BASE CASE (~45%). The pattern that just played out -- a diplomatic pause followed by a fresh kinetic event -- keeps repeating without a decisive move either way; Brent holds in the $85-95 range. Pump price grinds up from today's $4.10, ending near $4.40.

Scenario 3 — Escalation

$5.75

ELEVATED TAIL RISK (~35%). Another major kinetic event occurs -- of the kind that just happened Jul 28 -- and this time doesn't stop at an intercepted missile barrage; Brent pushes toward $115+. SPR breaches the ~250 mbbl operational floor further than the base case. Year-end ~$5.75 — further exceeding the 2022 record.

Reference: 2022 historical peak

$5.00 / gal
June 2022, one-week record

The 2022 peak (Russia-Ukraine + post-COVID demand) was the ceiling every prior scenario stayed under. Scenario 3 (escalation) projects $5.75 -- reflecting the Jul 28 pattern (a pause broken by a surprise missile attack) and the risk of repeated re-escalation cycles continuing through 2026.

Reference: SPR operational floor

~250 mbbl
salt-dome hydraulic limit

Below ~250 mbbl, the four Gulf-coast salt-dome caverns cannot sustain maximum-rate pumping (brine displacement geometry). Currently 316.5 mbbl (Jul 10 print, final, lowest since April 1983, below even the 2023 drawdown low) — ~66.5 mbbl above the floor. The escalation scenario now projects breaching it more deeply by December.

Chart 1 — AAA national-average pump price ($/gallon)

The headline number. What drivers pay. Y-axis $3 to $7; the 2022 historical peak of $5.00 marked as a dashed reference; the pre-conflict baseline of $2.98 visible at the chart floor.

Chart 2 — Strategic Petroleum Reserve, million barrels

The buffer mechanic. As the SPR depletes toward its ~250 mbbl operational floor, its capacity to muffle crude spikes weakens. The lower the SPR sits, the steeper the corresponding pump-price scenario above.

FebMarAprMayJunJulAugSepOctNovDec

AAA pump price — observed

SPR inventory — observed

Scenario 1: De-escalation (~20%)

Scenario 2: Sustained standoff — base case (~45%)

Scenario 3: Escalation tail (~35%)

Forecast model · GEF supply-chain analysis · pump prices from AAA daily averages · SPR levels from EIA Weekly Petroleum Status Report · scenarios are illustrative, not guarantees · rebuilt Jul 30 following the direct US-Iran military channel reopening (Iran's missile attack on US forces, US strikes on Iran itself) and the Jul 29 EIA release global-energy-flow.com · July 21, 2026

Reading the chart. The two solid blue lines are observed, through July 28 (top) and July 24 (bottom): the top chart shows the AAA national-average pump price climbed from $2.98 on February 26 (pre-conflict) to a peak of $4.55 on May 21, eased to a $3.83 low on July 2, then reversed hard as the Hormuz/Bab el-Mandeb crisis re-escalated -- reaching $4.09 by July 23 and $4.10 by July 28, after a whipsaw that saw Brent hit a two-month high near $102 (Jul 23), slide 16% over three days to $84.09 (Jul 28), then jump back sharply after Iran's missile attack on US forces was followed by the US striking Iran directly. The bottom chart shows the Strategic Petroleum Reserve falling from approximately 415 million barrels on February 28 to 307.7 million barrels on July 24 — a drawdown of about 107.7 million barrels since the conflict began, its lowest level in over 43 years, below even the 2023 drawdown low. The official EIA release for that week also showed commercial crude (excluding the SPR) drawing a much larger-than-expected 7.167 million barrels. The three dashed paths bracket what happens between now and year-end. The key analytical read on this page continues to hold: GEF's own AIS audit still shows the Hormuz core holding, with no confirmed fresh closure signal at the strait itself, even through a week that saw the direct US-Iran military channel fully reopen -- so the scenario weights reflect genuine uncertainty about which direction resolves first, not a confirmed trajectory either way. In the escalation scenario, the SPR breaches the buffer-exhaustion zone more deeply by December at the same moment the pump price in the chart above climbs further past the 2022 record.

Scenario 1De-escalation — a genuine, lasting US-Iran stand-down takes hold this time. Optimistic case (~20%). Unlike the 3-4 day pause that just broke on Jul 28, Iran and the US actually sustain a stand-down and use it to rebuild a working framework; Brent eases back toward the $80s and then the $70s as the crisis genuinely cools. On this path, the SPR draw bottoms out in the coming weeks before a partial refill begins in Q4, ending near 325 mbbl. The national-average pump price drifts down from today's $4.10 toward the $2.98 pre-conflict floor but does not fully close the gap, reflecting a persistent risk premium tied to the thin domestic buffer and the credibility damage from repeated framework breakdowns this year — ending December near $3.75.

Scenario 2Sustained high-tension standoff — pauses keep breaking, but neither side commits to full-scale war. Base case (~45%). The pattern of the last several weeks continues, and Jul 28 is the latest instance of it: a brief pause, then a fresh strike or missile attack, then de-escalatory rhetoric again. GEF's own AIS keeps showing Hormuz's core holding, consistent with this scenario rather than either extreme. The SPR keeps drawing through the second half of the year as Washington manages the ongoing standoff without refilling, ending December around 265 mbbl. The national-average pump price grinds up from today's $4.10 as the elevated Brent level (roughly $85-95) passes through to the pump, ending the year near $4.40.

Scenario 3Escalation — the Houthi Saudi-shipping embargo materializes physically, or another kinetic event lands. Elevated risk (~35%, up from 25%). The declared Bab el-Mandeb embargo against Saudi Arabia produces an actual first strike on shipping, or a strike lands on Kharg Island itself, pushing Brent toward $115+. The SPR drawdown accelerates through Q3 and Q4, breaching the ~250 mbbl operational floor more deeply than the prior model by December — where salt-dome hydraulics force a sharp pace reduction and the buffer's price-muffling capacity is exhausted just as the shock peaks. National-average pump price climbs further past the 2022 record, ending December near $5.75. This is the path that would revive the policy conversations (export caps, refining mandates, demand-side measures) that a calmer trajectory had kept off the table — and given the Houthis have already demonstrated the capacity to disrupt Bab el-Mandeb shipping for months during the Gaza war, GEF weights this scenario more heavily than any prior model.

SPR mechanicWhy the buffer is the right thing to watch. The Strategic Petroleum Reserve is not a price-setting tool, but it is the federal government's most direct lever on retail-gasoline price action. The four salt-dome caverns in Texas and Louisiana hold up to ~714 million barrels at design capacity; the operational floor — below which oil can still be drawn but not at full rate — sits around 250 million barrels (this is the hydraulic-limit number, set by the brine displacement geometry of the caverns themselves, not by policy). Above the floor, every barrel released into the crude market reduces the marginal price that gasoline refiners pay for feedstock, and that flows through to pump prices with a one-to-two-week lag. Below the floor, that mechanic breaks: the draw rate caps out at a fraction of what's needed to muffle a spike, and crude prices flow into pump prices more directly. The reserve drew a further 3.0 million barrels in the week ending Jul 10 alone; it is now below even the 2023 drawdown low and at its lowest level since April 1983, at 316.5 mbbl on the Jul 10 print — just ~66.5 mbbl above the floor. At the current pace, the ~250 mbbl floor could be reached well before year-end if the draw continued unbroken, and crude prices are once again under upward pressure after Monday's mixed news — meaning the reserve is thinning at the same moment the underlying situation remains genuinely unresolved in either direction. That is the structural contradiction the escalation scenario captures directly: the next genuine supply shock would land on the weakest domestic buffer position in more than four decades, at the same time crude itself is under renewed upward pressure.

State extremesWhat gas costs across the country today. Beneath the $4.10 national average sits a regional spread of roughly $2/gallon, structured by state taxes, environmental specifications (California's CARB-spec gasoline costs more to refine), refining capacity, and pipeline access. State-level figures below are the last confirmed AAA breakdown (Jul 23).

Most expensive (per AAA, Jul 7)

Hawaii$5.46

California$5.38

Washington$4.99

Alaska$4.69

Nevada$4.55

Least expensive (per AAA, Jul 7)

Indiana$3.21

Oklahoma$3.40

Texas$3.41

Mississippi$3.43

Kentucky$3.45

The California–Oklahoma spread of $1.73/gallon is approximately 45% of the national average — structural, and persists across all crude-price environments. In Scenario 3 this spread widens further — high-tax, CARB-spec states absorb a larger share of any price increase because their underlying refining cost structure is already stressed. For continuously updated state-level prices, see AAA's state gas-price averages.

MethodThis is a scenario forecast, not a prediction. The observed Feb–Jul pump-price line is built from AAA daily national averages; the observed SPR line is from EIA Weekly Petroleum Status Reports. The Jul–Dec branches are illustrative model paths, not guarantees; the underlying scenario weights (45% base / 20% de-escalation / 35% escalation) were built around exactly the pattern that played out again this week -- a diplomatic pause broken by a fresh kinetic event, this time escalating all the way to direct US strikes on Iran itself. The real outcome depends on whether a stand-down genuinely holds, refinery uptime, the rate at which Washington draws or refills the SPR, and winter weather severity. Charts and text rebuilt July 30, 2026. Sources: AAA Fuel Prices (national average $4.10, Jul 28; state extremes Jul 23), EIA Weekly Petroleum Status Report (week ending Jul 24, released Jul 29: commercial crude 404.5 mbbl, a 7.167 mbbl draw vs a 1.3 mbbl forecast; SPR 307.7 mbbl carried from the Jul 28 API preview pending explicit EIA confirmation), EIA Strategic Petroleum Reserve historical inventory, US Department of Energy SPR Quick Facts, CNBC/Bloomberg/Rigzone/CENTCOM/Reuters/Axios (Jul 28-30: Iran's missile attack on US forces, US+Saudi strikes on Iraq militia sites, the US direct strike wave on Iran), GEF's own AIS chokepoint audit. Per-disruption detail and the live US shortage map at global-energy-flow.com/shortages/united-states/.

Related forecasts: the Australia petrol & diesel forecast tracks the June 30 fuel-excise cliff and the Geelong refinery RCCU restart (two scenarios); the UK jet-fuel forecast tracks British aviation against the IEA 23-day threshold (three scenarios); the EU petrol & diesel availability forecast covers continental Europe (road-fuel-led stress, two scenarios). See also the Strait of Hormuz status page and the live global shortage tracker.