Rising oil prices tied to the escalating conflict with Iran have prompted the Treasury Department to prepare measures aimed at easing pressure on U.S. energy costs, Reuters reported Thursday.
Reuters reported Treasury officials were expected to announce steps as early as Thursday designed to counter the surge in energy prices following U.S. and Israeli strikes on Iranian targets.
The price increases come as the Middle East conflict approaches the one-week mark after the joint U.S.-Israeli strikes triggered retaliatory actions from Iran.
Iran responded to the attacks by closing the Strait of Hormuz, a critical global shipping route through which a large share of the world’s oil supply normally passes.
Energy analysts cited in coverage from Reuters and Politico noted the narrow Persian Gulf corridor carries more than 20% of the world’s oil supply, making disruptions there particularly significant for global markets.
The disruption of shipping through the waterway has tightened global supply and sent crude prices climbing in international markets.
Market data Thursday showed the price of West Texas Intermediate crude oil, the main U.S. benchmark, rising to more than $79.70 per barrel.
Energy market figures show the price represents an increase of more than 25% compared to the cost of oil one month earlier.
Oil prices jumped more than $10 per barrel in the days following the strikes on Iran and Tehran’s retaliation against energy infrastructure in the Persian Gulf, according to Politico.
The rise in crude costs has already begun showing up in higher prices for American drivers.
AAA reported Thursday that the national average price for a gallon of regular gasoline climbed to $3.25.
AAA data shows the current national average is up from $2.98 just one week earlier.
AAA also reported that gasoline averaged $2.89 per gallon a month ago.
AAA figures further show the national average stood near $3.11 per gallon at this time last year.
Energy analysts cited by Politico said the spike pushed gasoline prices to their highest levels since President Donald Trump took office last year.
Patrick De Haan, head of petroleum analysis at GasBuddy, warned Thursday that the pace of increases is beginning to resemble a previous major energy shock.
“It’s really starting to feel like March 2022 again,” De Haan wrote Thursday on the social media platform X while referencing the spike in fuel prices that followed Russia’s invasion of Ukraine.
De Haan later reported the current seven-day rolling increase in diesel fuel prices has reached 45.5 cents per gallon.
According to De Haan, the surge ranks as the 10th-largest diesel price jump on record.
De Haan also noted that the nine largest diesel price increases before the current spike all occurred in 2022 during the global energy disruption following Russia’s invasion of Ukraine.
President Donald Trump said Thursday he was not concerned about the recent rise in gasoline prices, telling Reuters in an exclusive interview that the U.S. military operation against Iran remains the administration’s top priority.
“I don’t have any concern about it,” President Trump told Reuters when asked about higher prices at the pump.
“They’ll drop very rapidly when this is over, and if they rise, they rise, but this is far more important than having gasoline prices go up a little bit,” President Trump told Reuters.
President Trump also told Reuters that gasoline prices have not increased dramatically since the conflict began.
President Trump said the costs “haven’t risen very much,” according to Reuters.
President Trump said earlier this week that even if prices rise in the short term, they are likely to fall once the conflict concludes.
“If we have a little high oil prices for a little while, but as soon as this ends, those prices are going to drop, lower than even before,” President Trump said earlier this week.
At the same time, Trump administration officials are actively exploring ways to bring down fuel costs as global energy markets react to the widening conflict.
Politico reported that White House chief of staff Susie Wiles directed administration officials to present ideas to the Oval Office aimed at lowering gasoline prices.
Energy industry executives familiar with the discussions told Politico the White House is examining multiple options to ease pressure on consumers.
The White House is “looking under every rock for ideas on improving energy prices, especially gasoline prices,” one energy executive familiar with the discussions told Politico.
Energy Secretary Chris Wright and other officials responsible for energy policy have been tasked with identifying options that could calm markets and reassure consumers, according to people familiar with the internal discussions cited by Politico.
Secretary of State Marco Rubio said earlier this week that the administration anticipated rising energy prices tied to the conflict.
Rubio told reporters Monday that Energy Secretary Chris Wright and Treasury Secretary Scott Bessent would implement a program designed to offset rising oil prices.
“We knew that going in would be a factor, and so we have a program in place that will begin to be implemented by Secretary Wright, Secretary Bessent,” Rubio told reporters.
Among the ideas under discussion is a temporary federal gasoline tax holiday, though Politico reported such a move would require congressional approval and might not immediately translate into lower prices if retailers do not pass along the savings.
Administration officials have also discussed easing environmental rules around summer gasoline blends and allowing higher ethanol blends in fuel to increase supply, according to people familiar with internal deliberations cited by Reuters.
The administration has already taken steps aimed at stabilizing global energy shipments through the Persian Gulf.
President Trump announced that the United States would protect commercial vessels traveling through the Strait of Hormuz after Iran threatened tanker traffic in the region.
President Trump also directed the U.S. International Development Finance Corp. to provide political risk insurance for maritime shipping companies traveling through the Persian Gulf.
Politico reported the insurance program is designed to ensure vessels continue operating after some insurers canceled policies as fighting intensified.
White House press secretary Karoline Leavitt said the administration believes the president’s actions against Iran will ultimately strengthen global energy markets.
“I think it speaks to why this action was so necessary,” Leavitt told reporters Wednesday.
“Ultimately, the energy industry is going to benefit from the president’s actions with respect to Iran,” Leavitt said.
President Trump also warned that the United States could take further steps to ensure oil shipments continue moving through the strategic waterway.
“If necessary, the United States Navy will begin escorting tankers through the Strait of Hormuz, as soon as possible,” President Trump wrote Tuesday on Truth Social.
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