What Drivers Pay for Gasoline After the 2026 Oil Shock

US gasoline is $1.23 a gallon dearer than a year ago, and diesel set a record in September

Gas prices in late 2026 are being set by a supply shock, not by demand. Before the conflict, the market looked oversupplied: Brent averaged $69.14 a barrel in 2025, its lowest annual level since 2020, and US regular gasoline averaged $3.097 a gallon, the cheapest year since 2021. In the week of 23 February 2026, a gallon of regular cost $2.937. Eight months later it costs $4.269, and the EIA expects the fourth quarter of 2026 to average $4.15.

The weekly EIA survey for 26 October 2026 shows how uneven the increase has been across the country. California drivers paid $5.888 a gallon, the West Coast as a whole $5.417 and the Rocky Mountain region $4.458, while the Gulf Coast, which sits next to most US refining capacity, paid $3.702. Diesel has risen faster than gasoline: the national on-highway average reached $6.529 a gallon in the week of 21 September 2026, the highest weekly price in the EIA series and well above the June 2022 record of $5.810. On 26 October it was $6.352, compared with $3.718 a year earlier.

Source: US Energy Information Administration, Gasoline and Diesel Fuel Update, prices of 26 October 2026, all taxes included.

This page focuses on oil and motor fuel prices. For electricity, natural gas and the energy bills of American households, see our analysis of energy prices in the US, and for power tariffs around the world our ranking of global electricity prices.

Brent averaged $69.14 in 2025; the first nine months of 2026 averaged $93.27

Crude oil is the largest single cost in a gallon of gasoline, so the long run path of the two main benchmarks explains most of the long run path of pump prices. Brent, a blend of North Sea grades loaded onto tankers, is the reference for most internationally traded crude. West Texas Intermediate (WTI) is priced at the inland US hub of Cushing, Oklahoma, and is the main reference for US refiners. The EIA annual averages below use daily spot prices.

Three peaks in 26 years: 2008 ($96.94 for Brent), 2011 to 2013 (above $108 each year) and 2022 ($100.93). The 2026 January to September average of $93.27 is the highest since 2022.

The series shows four distinct regimes. Prices climbed from $28.66 in 2000 to a 2008 average of $96.94 as demand from China and other emerging economies grew faster than supply. After the financial crisis they recovered quickly and Brent averaged more than $108 a barrel in each year from 2011 to 2013, the longest run of triple digit annual averages in the EIA series, which starts in 1987. The rise of US shale output and the decision of OPEC members to defend market share pushed the average down to $43.64 in 2016. The pandemic produced the lowest annual average of the period, $41.96 in 2020, and the invasion of Ukraine the most recent peak, $100.93 in 2022.

Between 2022 and 2025 the average fell every year, to $82.49, $80.52 and finally $69.14, a 14 percent drop in 2025 alone. WTI followed the same path at $65.39 in 2025. That backdrop matters for reading 2026: the shock started from the weakest annual price level in five years and with OPEC+ already adding barrels. Our weekly Brent, WTI and OPEC basket closing prices since 2020 show the same story at weekly resolution, and the global oil industry overview covers production, reserves and company revenues.

Brent rose 61 percent between February and September 2026

Monthly averages remove the noise of single trading days and show the shape of the shock clearly. Brent averaged $66.60 in January 2026 and $70.89 in February. On 28 February, US and Israeli military operations against Iran began, and from 4 March Iranian forces declared the Strait of Hormuz closed and attacked ships trying to transit it, according to the Congressional Research Service. The March average jumped to $103.13 and April to $117.29, the highest monthly average in the chart.

Two waves, not one: the first peak came in April ($117.29 for Brent), prices eased through July ($83.76), and a second wave in September ($114.16) followed attacks on the Saudi East-West pipeline.

Prices eased from May as workarounds took hold and as global demand weakened. By July Brent was down to $83.76. A second wave followed in September, when attacks hit oil infrastructure and tankers around the region, including the Saudi East-West pipeline that had been carrying more than 5 million barrels a day to the Red Sea port of Yanbu. Brent averaged $114.16 in September, $23 above August, and reached $131 on 15 September, according to the EIA. The pipeline was repaired and partly back in service by 22 September.

The gap between the two benchmarks is one of the clearest signatures of this shock. In 2025 Brent traded $3.75 above WTI on average. In September 2026 the gap was $16.85 ($114.16 against $97.31). Brent prices seaborne crude that competes for the same tankers, insurance and refinery customers as Middle East supply, while WTI reflects barrels at an inland US hub, so Brent absorbed more of the shipping risk. For US drivers this was a partial cushion; for importers in Europe and Asia it was an added cost.

A chokepoint that carried a fifth of world oil consumption

The size of the price move reflects the importance of a single waterway. In 2024 an average of about 20 million barrels a day of crude oil and petroleum products moved through the Strait of Hormuz, roughly 20 percent of world petroleum liquids consumption and more than a quarter of seaborne oil trade, according to the EIA. Only about 2.6 million barrels a day of pipeline capacity in Saudi Arabia and the United Arab Emirates was available to bypass the strait, and 84 percent of the crude passing through it went to Asian buyers.

When transit stopped, producers around the Gulf had to shut in output they could not export. The EIA estimates that crude production shut-ins in the region peaked at 10.9 million barrels a day in May 2026, fell to 5.8 million in August and 4.8 million in September, and assumes an average of 4.5 million in the fourth quarter. Its October outlook expects most regional production to return to pre-conflict levels by the end of the second quarter of 2027, helped by bypass routes, ship-to-ship transfers along the coast of Oman and a new UAE bypass pipeline expected in 2027.

Source: US EIA, Short-Term Energy Outlook, 6 October 2026, tables 3a and 3c. 2025 values are estimates; 2026 and 2027 are forecasts. Stock change calculated by BusinessStats from the published production and consumption figures.

The table explains why prices stayed high even after demand fell. World consumption is expected to drop by about 2 million barrels a day in 2026, to 102.43 million. Production falls much further, by 5.2 million barrels a day, so the world has been drawing on stored oil. The EIA estimates that global inventories fell by an average of 1.9 million barrels a day in the third quarter of 2026 and expects a further 0.7 million a day of draws in the fourth quarter. Distillates are the tightest part of the market: East Coast distillate stocks were 32 percent below their five year average in September, which is why diesel has risen faster than gasoline. Depleted stocks then rebuild through 2027, which is the main reason the EIA forecasts lower prices next year.

Weekly US gasoline prices peaked at $4.500 in May 2026, below the 2022 record

Retail gasoline follows crude with a lag of a few weeks, because refiners and distributors work through inventories bought at earlier prices. The weekly EIA survey shows a first surge from $3.015 in the week of 2 March to $3.990 by 30 March, a peak of $4.500 in the week of 11 May, a summer dip to $3.777 in early July and a second rise to $4.478 in the week of 21 September. Even at its 2026 high, regular gasoline stayed below the all-time weekly record of $5.006 set in the week of 13 June 2022.

Up 45 percent since February: from $2.937 in the week of 23 February to $4.269 on 26 October, with a high of $4.500 in the week of 11 May.

On a monthly basis, regular gasoline averaged $2.809 a gallon in January 2026 and $2.908 in February, then $3.638 in March, $4.103 in April and $4.479 in May, the highest monthly average of the year so far. It eased to $3.932 in July before climbing again to $4.355 in September. The four October surveys average $4.310. Across the first ten months of 2026 the average was $3.864, compared with $3.097 for all of 2025. Higher fuel costs feed directly into consumer price inflation, which we track in our series on the monthly inflation rate in the United States.

Still below 2022: the 2026 average so far ($3.864) is the second highest in the series, behind $3.951 in 2022, but ahead of $3.618 in 2012.

The annual series puts the shock in context. US gasoline averaged $1.484 in 2000 and first passed $3 in 2008 ($3.246). It stayed above $3.35 every year from 2011 to 2014, fell to $2.143 in 2016 and to $2.168 in 2020, and reached the record annual average of $3.951 in 2022. The 2026 average to date is the second highest on record in nominal terms. The EIA expects the full year to average $3.91, which would leave 2026 just below 2022. How much of each dollar goes on fuel compared with other energy is covered in our data on US fossil fuel consumption.

Crude oil makes up about half of the US pump price; taxes about one sixth

The EIA splits the retail price of regular gasoline into four parts. In 2025, when the average price was $3.10 a gallon, crude oil accounted for 51.4 percent, refining costs and profits for 14.3 percent, distribution and marketing for 17.8 percent, and federal and state taxes for 16.6 percent. Over the decade from 2016 to 2025, crude averaged 51.7 percent of the price and taxes 17.4 percent.

Crude is the swing factor: taxes are fixed in cents per gallon, so when crude rises the tax share falls automatically.

Taxes in the United States are charged in cents per gallon rather than as a percentage. The federal tax is 18.4 cents, made up of an 18.3 cent excise tax and a 0.1 cent fee for leaking underground storage tanks. As of January 2026, state taxes and fees averaged 33.55 cents a gallon. Together that is 51.95 cents. At the 26 October 2026 price of $4.269, taxes were therefore about 12 percent of the pump price, down from 16.6 percent in 2025. Almost all of the 2026 increase reached drivers through the crude oil, refining and distribution components.

Europe pays more per litre, but its prices rose less in percentage terms

Retail fuel prices outside the United States are published by governments in local currency and per litre. To avoid adding exchange rate noise, the figures below are shown as published. The European Commission collects pump prices from every EU member state each week in its Weekly Oil Bulletin. In bulletin number 2331, with prices for 26 October 2026, the weighted EU average for Euro-super 95 petrol was 1.954 euros a litre and for diesel 2.146 euros, both including taxes.

Almost 1.20 euros between top and bottom: Denmark (2.525 euros) and Finland (2.346) are the most expensive, Malta (1.340), Poland (1.467) and Sweden (1.560) the cheapest.

The spread inside the EU is almost entirely a tax story. Member states buy petrol on the same regional wholesale market, but national excise duties and VAT rates differ widely. Malta had the cheapest petrol at 1.340 euros, and Poland the second cheapest at 1.467 euros. Denmark, Finland and the Netherlands topped 2.30 euros. Diesel was more expensive than petrol in 24 of the 27 member states on 26 October, all except Denmark, Greece and Malta, a reversal of the usual pattern that reflects the global shortage of middle distillates. For the structure of the European fuel market, see our page on the gasoline and diesel market in Europe, and for household energy costs in the bloc, energy prices in the EU.

The Commission noted in its bulletin of 27 April 2026 that prices rose sharply after the war on Iran and the closure of the Strait of Hormuz began on 28 February 2026 and that they were higher than during the 2022 and 2023 energy crisis. Several governments have responded with temporary tax changes. In the 26 October bulletin, Croatia ended a temporary cut in petrol excise and introduced lower diesel excise, and Italy lowered diesel excise. Germany cut its energy tax on petrol by 14.04 cents a litre from 1 May to 30 June 2026, according to the research service of the German Bundestag.

Sources: UK Department for Energy Security and Net Zero, weekly road fuel prices; Japan Agency for Natural Resources and Energy, weekly petroleum product price survey; Bharat Petroleum, price build-up of petrol at Delhi; All India Radio, 19 May 2026; Statistics Canada, Consumer Price Index, September 2026. Changes calculated by BusinessStats.

United Kingdom. The weekly government survey put unleaded petrol at 174.07 pence a litre and diesel at 199.22 pence on 26 October 2026. Diesel peaked at 200.04 pence on 12 October 2026, the highest weekly value in the government 2018 to 2026 dataset and above the 2022 peak, while petrol peaked at 175.28 pence on the same day, still below its July 2022 record of 191.55 pence. Fuel duty has stayed at 52.95 pence a litre throughout, with VAT at 20 percent.

Japan. Pump prices in Japan barely moved compared with other markets. The Agency for Natural Resources and Energy reported regular gasoline at 156.7 yen a litre on 16 February 2026, 167.4 yen on 6 April and 169.7 yen on 15 June. The reason is policy: from 19 March 2026 the government introduced emergency measures in response to the Middle East situation that pay a subsidy covering the full amount by which the expected national average would exceed 170 yen a litre. Diesel, kerosene and heavy fuel oil receive the same subsidy per litre. Japan also cut its diesel delivery tax from 32.1 to 15.0 yen a litre from 1 April 2026.

India. Fuel retailers raised prices in stages. All India Radio reported a 3 rupee a litre increase on 15 May 2026 and a second rise of about 90 paise that took petrol in Delhi to 98.64 rupees on 19 May. The Bharat Petroleum price build-up for 1 October 2026 shows a Delhi retail price of 102.12 rupees a litre, of which 16.59 rupees is Delhi VAT at 19.4 percent.

Canada. Statistics Canada reported that gasoline prices in the Consumer Price Index were 27.8 percent higher in September 2026 than a year earlier and 6.1 percent higher than in August, with increases in every province, while headline inflation was 3.1 percent. The effect of fuel on inflation across countries is tracked in our overview of global inflation.

US pump prices rose more than twice as much as the EU average

The chart compares the same two dates in each market, the week of 23 February 2026, the last full week before the war, and 26 October 2026. It uses official weekly data in local currency, so exchange rates play no part.

Low taxes, high pass-through: the US price rose 45.4 percent, the UK 32.2 percent and the EU average 19.4 percent over the same eight months.

The ranking is close to the reverse of the price level ranking. A litre of petrol in the Netherlands still costs far more than a litre in the United States, but because Dutch taxes are a large fixed amount per litre, the same increase in crude and wholesale costs is a smaller percentage of the final price. US pump prices, with taxes of about 52 cents a gallon, move almost one for one with wholesale costs. Diesel shows the same pattern at a higher level: the EU average diesel price rose 34.6 percent, from 1.594 to 2.146 euros, and UK diesel 40.8 percent.

Taxes are about 12 percent of the US pump price and about 47 percent in the UK

Tax design explains much of the difference between countries. The table applies the statutory rates of each country to its latest official pump price. Shares are BusinessStats calculations and refer to the dates shown.

Sources: US EIA; UK DESNZ weekly road fuel prices; Research Services of the German Bundestag, WD 4 - 3000 - 034/26 (June 2026), with the example CO2 charge of 15.7 cents a litre; Bharat Petroleum price build-up. Germany price from the European Commission Weekly Oil Bulletin. Shares calculated by BusinessStats.

The UK figure follows from simple arithmetic. VAT at 20 percent is one sixth of a VAT inclusive price, or 29.01 pence on 174.07 pence. Adding fuel duty of 52.95 pence gives 81.96 pence, or 47 percent of the price. In Germany the energy tax is 654.50 euros per 1,000 litres of petrol, and the national CO2 price for fuels is set at 55 to 65 euros a tonne in 2026; the Bundestag research service uses a CO2 charge of 15.7 cents a litre in its example. For India, the Bharat Petroleum build-up does not show central excise separately, so only the VAT share can be calculated from it.

OPEC+ raised quotas six months in a row while its actual output fell

OPEC+ policy in 2026 has been shaped by two events: the conflict, which cut what Gulf producers could physically export, and the departure of the United Arab Emirates. At their meeting on 1 March 2026, eight OPEC+ countries, Saudi Arabia, Russia, Iraq, the UAE, Kuwait, Kazakhstan, Algeria and Oman, decided to resume unwinding the 1.65 million barrels a day of voluntary cuts announced in April 2023, starting with 206,000 barrels a day in April. On 28 April the UAE announced that it would leave OPEC and OPEC+ with effect from 1 May 2026, and from the May meeting onward the official statements list seven countries.

Sources: OPEC press releases of 1 March, 3 May, 5 July, 2 August, 6 September and 4 October 2026; Qatar News Agency for 7 June and the Government of Sharjah media office for 5 April. b/d = barrels per day. The next meeting was scheduled for 1 November 2026.

On paper the group added 1.164 million barrels a day of quota between April and September (BusinessStats sum of the six increases). In practice, output moved the other way. The EIA estimates that total OPEC+ liquids production will fall from 39.36 million barrels a day in 2025 to 34.83 million in 2026, and OPEC output alone from 29.33 to 23.93 million, because much of the Gulf capacity could not reach the market. Quota decisions therefore matter less for prices in 2026 than shipping routes, and they will matter more again in 2027 as flows recover. Background on the producers is in our pages on the oil industry in the Middle East and on the countries with the largest oil reserves.

The EIA expects Brent to fall from $105 to $74 by late 2027

The EIA Short-Term Energy Outlook, released on 6 October 2026, assumes that oil flows from the Middle East remain constrained through the end of 2026 and recover gradually during 2027. On that basis it forecasts Brent at an average of $105 a barrel in the fourth quarter of 2026, $87 in the second quarter of 2027 and $74 in the fourth quarter of 2027. The annual averages are $96 for 2026 and $84 for 2027, compared with $69 in 2025. The forecast was completed on 1 October, so it does not reflect later events.

Forecast, not data: the red bars are EIA projections. They assume Middle East shut-ins average 4.5 million barrels a day in the fourth quarter of 2026 and fade during 2027.

Source: US EIA, Short-Term Energy Outlook, 6 October 2026. Forecasts rounded as published by the EIA. The EIA expects diesel to stay above $4 a gallon through 2027.

For drivers, the forecast implies relief that is real but slow. The EIA expects US regular gasoline to average $4.15 in the fourth quarter of 2026 and $3.24 in the fourth quarter of 2027, with an annual average just under $3.60 in 2027. Diesel is forecast at $5.81 in the fourth quarter of 2026 and about $4.50 on average in 2027. The main risks are on the upside: renewed attacks on export routes, slower repairs to damaged infrastructure, or a colder than normal winter that adds to the shortage of distillates. A faster reopening of the strait, combined with the OPEC+ quotas already agreed, would move prices down more quickly.

Six forces behind the price at the pump

• Crude oil supply and chokepoints. In 2026 the closure of the Strait of Hormuz removed up to 10.9 million barrels a day of Middle East production, the single largest driver of the price rise.
• Inventories. Stocks act as a buffer. Global draws of 1.9 million barrels a day in the third quarter of 2026 left little room to absorb new disruptions, which is why the September attacks moved prices so sharply.
• OPEC+ policy. The group returned 1.164 million barrels a day of quota between April and September 2026 but has held output targets steady since. Its spare capacity matters most once export routes reopen.
• Refining and product balances. Diesel and jet fuel are scarcer than gasoline worldwide, which pushed US diesel to a record $6.529 a gallon and made diesel dearer than petrol in most EU countries.
• Taxes and subsidies. Fixed per litre taxes dampen percentage changes in Europe; low US taxes amplify them; subsidies such as the Japanese 170 yen cap hide them from drivers and move the cost to public budgets.
• Demand and the economy. The EIA expects world oil consumption to fall by about 2 million barrels a day in 2026. Slower growth, which we follow in our data on world GDP growth, is the main force pulling prices down.

Longer term, demand for gasoline also depends on how quickly cars switch to electricity. Our ranking of the best selling electric vehicle models worldwide tracks that shift. For the refining step between crude and pump, see our overview of the global oil refinery industry.

How the figures on this page were compiled

All crude oil prices are spot prices published by the US Energy Information Administration: Europe Brent Spot Price FOB and Cushing, Oklahoma WTI Spot Price FOB. Annual and monthly averages are the EIA averages of daily prices; the 2026 year to date and quarterly averages are simple averages of the EIA monthly figures, calculated by BusinessStats. US retail prices come from the weekly EIA Gasoline and Diesel Fuel Update, which surveys prices every Monday and includes all taxes. Monthly and annual US gasoline averages are EIA series for regular gasoline, all formulations.

European prices come from the European Commission Weekly Oil Bulletin, which reports prices in force each Monday as submitted by member states, including taxes. UK prices come from the weekly road fuel price statistics of the Department for Energy Security and Net Zero. Japanese prices are from the weekly petroleum product price survey of the Agency for Natural Resources and Energy; the 15 June 2026 survey is the latest edition we could retrieve directly. Indian prices come from the Bharat Petroleum price build-up for Delhi. Canadian data are the gasoline component of the Statistics Canada Consumer Price Index, an index rather than a price.

Forecasts are taken from the EIA Short-Term Energy Outlook of 6 October 2026 and are labelled as forecasts wherever they appear. No exchange rate conversions are applied; each price is shown in the currency in which it was published. All prices are nominal. Tax shares apply statutory rates to the pump price on the stated date and are BusinessStats calculations. The previous version of this page relied on rounded and unsourced figures, including a 2025 Brent average of $78 and a 2026 US price of $3.30 a gallon; these have been replaced with official data.

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