ECONOMY STUDIOIn the week of October 12, 2026, a gallon of regular gasoline cost $4.33 on average, $1.27 more than a year earlier1. Diesel cost $6.182. The national average has been above $4 a gallon on 158 days this year, a record3.
Yet crude oil is moving through the Strait of Hormuz again. By late September, crude shipments were back at their prewar level of 13.5 million barrels a day4. So why hasn’t the price at the pump come down?
How we got here
The war began on February 28, 20265. In the last week before it, regular gasoline averaged $2.94 a gallon; two weeks later it was $3.506. It peaked at $4.50 on May 11, the high for 20267.
Iran declared the strait open on April 17, but a June agreement collapsed over the summer into renewed fighting5.
Crude came back. Fuel did not.
Tanker data from Kpler shows crude oil through Hormuz averaging 13.5 million barrels a day as of September 28, matching the prewar baseline4. Refined products, fuel that has already been through a refinery, averaged 677,000 barrels a day, against 3.6 million before the war4.
“Crude market has largely normalized even as refined product supplies remain constrained,” said Natasha Kaneva, head of global commodities strategy at JPMorgan8.
The flow is still fragile. About 20.8 million barrels passed through the strait on October 8, and only 2.9 million on October 11, after a new wave of attacks9. The UK Maritime Trade Operations center recorded 15 attacks on ships between October 6 and 149. In August, more than 70% of the crude that crossed switched tankers off the coast of the UAE or Oman, in a shuttle system protected by the U.S. military10.
Why diesel is the real squeeze
A 42-gallon barrel of crude yields about 19 to 20 gallons of gasoline and 11 to 13 gallons of diesel11. When diesel runs short, refiners need more crude to make it, and every product made from that barrel gets more expensive. EIA’s October outlook describes “extreme tightness in diesel markets that raises demand for crude oil in order for refiners to meet diesel demand”12.
Diesel set a record weekly average of $6.53 a gallon on September 21, 2026, above the 2022 record of $5.8113. In the week of October 12 it was $6.18, $2.51 more than a year earlier2. Of every $100 a trucker spends on diesel now, about $41 is this year’s increase14.
U.S. diesel stocks were 105.1 million barrels in early October, against 121.6 million a year earlier15. Gasoline stocks were 204.7 million, against 219.1 million15. On the East Coast, distillate stocks were 32% below their five-year average for September12.
The shortage is global. Ukraine’s strikes on Russian refineries led Moscow to ban diesel exports, and refineries in the Middle East have been attacked16.
American refineries are running hard, and exporting
In the four weeks to October 2, U.S. refineries ran at 94.0% of their capacity15. Net exports of petroleum products averaged 6.24 million barrels a day, up from 4.99 million a year earlier, a rise of 25%15. U.S. refiners have been sending diesel abroad, particularly to Europe, where margins are wide16.
That is how a war half a world away reaches an American pump. The United States imported only about 0.5 million barrels a day of crude through Hormuz in 2024, 2% of its petroleum consumption17. But oil and fuel trade on a world market, and fuel goes where it fetches the most.
WTI, the U.S. crude benchmark, was $100.86 a barrel on October 13, against $66.96 on February 27, the last trading day before the war18.
The government’s emergency stockpile has been drawn down as well. The Strategic Petroleum Reserve held 283.0 million barrels, down from 407.0 million a year earlier15: 30 of every 100 barrels are gone19.
Where your $4.33 goes
EIA’s latest breakdown, from May 2026, splits a gallon of regular gasoline into crude oil 52%, refining 22%, distribution and the station 15%, and taxes 12%20. For diesel, crude is 42% and refining 25%20.
At today’s price, a 15-gallon fill-up costs $19.05 more than a year ago, and $100 buys 23.1 gallons instead of 32.721.
The cost reaches every other price too. Gasoline rose 9.1% in September alone, “accounting for over half of the monthly all items increase,” and it is up 34.2% over 12 months22. Overall inflation was 3.7%22. The minutes of the Federal Reserve’s September meeting say that the longer energy prices stay high, the greater the risk to inflation23. That is part of why borrowing is suddenly so expensive.
When does it come down?
EIA’s October forecast says oil flows from the Middle East will stay constrained through the fourth quarter of 202612. It expects regular gasoline to average $3.91 this year and $3.56 in 2027, and diesel $5.19 and $4.4912.
At $3.56 a gallon, $100 would buy 28.1 gallons, against 23.1 today24.
Hurricane season adds risk. Ahead of Hurricane Isaias, about 63% of oil production in the Gulf of Mexico had been shut in as of October 825.
So why is gas still above $4?
Because the strait reopened for crude oil, not for fuel4. Refineries at home are running near their limit and selling abroad15, diesel stocks are low15, and the world is short of refined fuel16. Until that changes, a gallon stays expensive, wherever the crude comes from.
