By David Uberti

About 8,000 miles from the Middle East, where U.S. forces massed over the past month to prepare for war, Heather Griffith has been jotting a string of rising numbers into a notebook.

The trucker catalogs diesel prices each time she fuels up for the roughly 500-mile round trip she makes six nights a week hauling modular dorm rooms from outside Los Angeles to California Polytechnic State University. A more than $1-a-gallon run-up since January shaves about 5% off her earnings for most journeys.

"Now, we're going to eat a lot of it," Griffith said. She would have asked for better rates had she known about the impending geopolitical turmoil.

Griffith is one endpoint of a chain reaction across oil drillers, refiners, tanker operators and financial markets set off in recent weeks by the prospect of war with Iran. If trading since missiles and drones started flying is any indication, millions of Americans like Griffith may soon see higher prices spread beyond the pump and into airfares, factories, construction sites, and even products and produce transported nationwide.

The conflict with Iran throttled one of the key shipping routes for global energy and brought the world to the brink of a shock. Costs of diesel, gasoline and jet fuel have surged at paces that echo 2022, when Russia's invasion of Ukraine sparked some of the wildest commodity trading on record.

Benchmark U.S. crude futures this week skyrocketed at their fastest rate in records stretching back to 1983, surging 36% to $90.90 a barrel. Many analysts believe $100 oil is fast approaching. Run-ups beyond that could raise the risk of a recession.

Average U.S. diesel prices jumped 51 cents a gallon over the past week, according to GasBuddy, while gasoline costs climbed 32 cents. GasBuddy analyst Patrick De Haan Friday estimated Americans are collectively spending $122 million more on gas every day than they did a week ago.

Energy Secretary Chris Wright said in an interview Friday that "Americans never like high prices." But he discounted the likelihood of a long-term disruption.

The conflict began "with U.S. oil production at all-time highs, a world well-supplied in oil, new increases in production coming out of Venezuela," he said. "If this is brief in duration, it's a small dislocation. It's a small amount of short-term pain for enormous long-term gain for peace and stability and investment in the Middle East."

In 2022, Biden administration officials spent months scrambling to contain the chaos the Ukraine war unleashed across commodity markets and supply chains.

"You see why the [1970s] oil shocks were so hard to control," said Alex Jacquez, a Biden-era official who is now chief of policy and advocacy at Groundwork Collaborative, a progressive think tank. "There's all these ripple effects that stemmed from this disruption in Eastern Europe that were unforeseen and we were reacting to in real-time."

Crude prices are far below their 2022 peaks and within historical norms. Energy-rich America is insulated from fallout in ways that Asia and Europe aren't. But continuing threats to tankers in the Strait of Hormuz, coupled with shut-ins at nearby oil fields, natural-gas terminals and more, slowed exports through the roughly 20-mile-wide shipping lane to a trickle.

Companies and investors were monitoring the military buildup as the U.S. and Israel prepared to strike. But the speed and severity of Iran's counterattacks across energy powerhouses lining the Persian Gulf caught many off guard.

"That's where the surprise was," said Paul Baris, a principal at supply-chain consulting firm Efficio.

Benchmark U.S. crude futures have risen 58% this year. Contracts for diesel and gasoline deliveries next month catapulted even higher.

On Wall Street, deadly blows across the Middle East have shaken markets. After oil producers began snapping up options to lock in future price levels early this week, some airlines jumped in to shield themselves from risk as the price of jet fuel surged.

"When it's one headline after another, and you can't get a rhythm going in the market and have a lot of conviction in your position, it is the time you form an ulcer," said Rebecca Babin, a senior energy trader for CIBC Private Wealth.

Babin has at times shrunk positions and tightened her risk threshold in response to volatility, racing to understand fast-changing freight costs and insurance premiums.

"Like everybody else, I'm watching if ships are going to move through the strait," Babin said. "Words are not going to be enough to calm the market at this point -- we will need to see action soon to inject some confidence in the veins of traders."

On Friday, the U.S. International Development Finance Corp. said it would create a $20 billion reinsurance facility to help cover potential losses. But shipowners question how quickly the small agency can spin up insurance products for a war zone.

Some analysts have speculated the Treasury Department could jump into futures markets to help arrest price increases. "We don't have any plans to be in the crude-trading business," the Energy Department's Wright said Friday. He said other measures are on the table.

Wright also pointed to global reserves on hand, casting the recent price run-up as a market overreaction.

"Uncertainty leads people to emotional reactions," he said. "But rationality wins out in the end in the market."

Treasury this week allowed India to temporarily buy Russian oil at sea and eased sanctions to allow transactions with the German branch of Russia's Rosneft oil company. President Trump also suggested potential Navy escorts of commercial ships through the strait, a tactic employed to stymie attacks on tankers during the Iran-Iraq war in the 1980s.

Some investors and shipping representatives warn that even tankers with federally backed insurance policies would avoid the voyage until fighting dies down or the U.S. military has enough assets in the region to deter strikes.

With skyscraper-size vessels funneling through a six-mile-wide strip of water within the strait at its narrowest point, "There's less reaction time," said retired U.S. Navy Capt. Jim McTigue, who commanded a frigate that shepherded tankers in the '80s.

"There's more ability [for Iran] to bring weapons to bear," he said. "It makes for a very tight environment."

Should stoppages continue, analysts warn American drillers in the Permian Basin have little interest or wherewithal to immediately pump more crude.

The economics of oil production are often linked to companies' ability to sell natural gas created as a byproduct. But gas pipelines in the region are nearly maxed out. At the same time, U.S. gas exports are largely spoken for with long-term contracts.

"If you can't get gas out, you can't get crude out," said Rob Wilson, chief operating officer at East Daley Analytics.

Even as America produces more oil than any country ever, some regions of the country still rely on imports. An extended shut-off of jet fuel and diesel from the Middle East into the global market could pit the fuel-poor U.S. coasts against Europe and Asia for supplies.

After a cold winter in the Northeast, "Nobody came into this carrying extra inventory," said Mark Romaine, chief operating officer at Global Partners, which runs fuel terminals across the region. Near-term contracts remain costlier than future supplies, discouraging companies from stockpiling.

The longer the war lasts, the riskier it will become to continue operating hand to mouth.

"The biggest wild card here is duration," Romaine said. "How long does this go on?"

Write to David Uberti at david.uberti@wsj.com

(END) Dow Jones Newswires

March 06, 2026 19:00 ET (00:00 GMT)

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