US Oil Prices Expected to Swing Again Monday as Iran Conflict Tightens Supply

US oil prices are expected to experience another round of dramatic swings on Monday, as three weeks of war with Iran continue to constrain global oil supply. Petroleum analyst Patrick De Haan has placed his forecast at $3.80 to $3.85 per gallon at US pumps, while acknowledging that $4 gas is still within the realm of possibility. The sustained conflict has upended energy market stability and placed growing financial pressure on American consumers.
The current surge in fuel costs is a direct result of the US-Israel campaign against Iran that began on February 28. National gasoline averages have since climbed 23% from below $3 per gallon to $3.70, driven by physical supply disruptions and market uncertainty. The conflict has struck at the heart of a region responsible for a major share of global oil production.
Among the most impactful recent developments was Friday’s US strike on Kharg Island, which handles a large portion of Iran’s petroleum processing and export. Iran’s continued blockade of the Strait of Hormuz, which handles around 20% of global oil flow, has significantly reduced world oil supply. Brent crude reached $106 per barrel early Monday before retreating to $103, and US crude was at $94 following a brief spike to $100 on Sunday.
Regional disparities in price impacts are significant, with California facing average pump prices above $5 and some Los Angeles stations charging over $8. Diesel, critical for freight transport, could reach $5.05 to $5.15 per gallon nationally. White House officials have received alarming briefings from Exxon’s CEO Darren Woods and leaders at Conoco and Chevron, all of whom have flagged the risk of continued supply erosion and speculative market inflation.
The US stock market opened Monday with limited optimism, with the S&P 500 gaining approximately 1% as oil prices briefly softened. Oil company shares have surged to record levels overall since hostilities began. The contrast between booming energy sector valuations and struggling American households encapsulates the unequal distribution of the conflict’s economic consequences.