On April 1, President Trump made a point of telling Americans that the Iran war and the fight over the Strait of Hormuz had little to do with them at the pump. The U.S. barely imports oil from the Middle East, he said. We don't need it. We haven't needed it.

He's right that the U.S. only gets about 8% of its oil imports from the Middle East.

He's wrong that it doesn't affect gas prices here.

On April 8 a gallon of regular gas cost $4.16 on average across the United States. A month ago it was $3.45. At the start of the year it was under $3. That's not a coincidence. That's the Iran war showing up at the pump — and the reason why has everything to do with how global oil markets actually work.

Oil Goes Where the Money Is

Here's the thing most people don't realize. Oil isn't bought and sold the way most goods are. There's no "American oil for Americans" pipeline. It's a single global market where crude flows to whoever pays the highest price — period.

The U.S. produces more than 13 million barrels of crude oil a day and exports more than it imports. On paper that sounds like insulation from Middle East chaos. In practice it means nothing, because American oil producers are businesses. They sell to the highest bidder, wherever that bidder happens to be.

"Oil literally flows to the highest price," said Mark Zandi, chief economist of Moody's Analytics. "If a tanker can get a higher price in Malaysia than it can in Rotterdam than it can in Rio de Janeiro, it's going to go to Malaysia."

When the war with Iran disrupted supply across the region — through the closure of the Strait of Hormuz, the sudden danger of shipping through those waters, and damage to oil infrastructure — prices spiked everywhere. Not just in Asia and Europe, which rely heavily on Middle Eastern oil. Everywhere. Including here.

By the West Texas Intermediate benchmark, crude oil prices climbed from about $67 a barrel on February 27 to around $105 by March 30. That's a massive move in a short window and American consumers felt every bit of it.

"Everybody's competing for the same barrel of oil," said James Cox, managing partner at Harris Financial Group. "It doesn't matter whether it's produced in Texas or Iran or Saudi Arabia or Russia."

California Is Getting Hit the Hardest

While the national average topped $4, California hit $5.93 a gallon. The reason is geography — the West Coast draws more of its oil from the Middle East than the rest of the country does and has limited access to domestic supply east of the Rockies.

"We get nothing from east of the Rockies," said Kate Gordon, CEO of California Forward. California's exposure to Middle Eastern supply disruptions is simply higher, and the pump price reflects that directly.

This Isn't the 1970s — But It's Not Nothing Either

The good news is that the Iran war didn't trigger the kind of crisis Americans over a certain age remember from the 1970s. That era brought rationing, price controls, a national 55 mph speed limit, and genuinely long lines at gas stations. What happened this time was painful but not catastrophic — higher prices, not shortages. The lines at Costco were mostly people trying to save a few bucks, not desperate drivers running out of options.

Some other countries fared worse. Nations more dependent on Middle Eastern oil introduced four-day work weeks, remote work mandates, rationing, and public calls to reduce air conditioning use and take public transit. The U.S. avoided all of that.

"You could say the U.S. economy, on net, is somewhat insulated from the shock because we are such a large supplier," said Nikolai Roussanov, finance professor at the Wharton School. "But that doesn't help the consumer at the pump."

That last sentence is really the whole thing. The U.S. being a major oil producer softens the macroeconomic blow. It doesn't soften the bill when you fill up your tank.

When Will Prices Come Down?

A fragile ceasefire has emerged and oil prices dropped on the news. Gas prices should follow — but don't expect a quick return to $3 a gallon.

"We'll probably go back to $3.50 by late summer, but that's probably where it'll hang for a while," Zandi said.

A few reasons prices will stay elevated even with a ceasefire in place. Insurance on ships passing through the Strait of Hormuz will remain high as long as there's any risk of the ceasefire breaking — and traders will price in that risk for months. Oil infrastructure in the region that was damaged or destroyed during the conflict will take years to rebuild in some cases, keeping global supply tighter than it was before the war started.

Oil futures — contracts that bet on where prices will be in the future — remain elevated through the end of 2026. The market is telling you something.

"There's no going back to what we had," Zandi said. "At least not this year."

Curious for more stories that keep you informed and entertained? From the latest headlines to everyday insights, YourLifeBuzz has more to explore. Dive into what’s next.