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What is the war in Iran going to do to oil and gas prices?

The average cost of a gallon of gas in the U.S. is up more than 20 cents since the conflict began, according to AAA.
What is the war in Iran going to do to oil and gas prices?
Gasoline nozzle being used to pump gas.
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America's war with Iran is already causing gas prices to soar at home.

The average cost of a gallon of gas in the U.S. is up more than 20 cents since the conflict began, according to AAA.

"Right now we're looking at oil prices that are moving higher as a result of the conflict in the Middle East,” said AAA’s Mark Jenkins.

That's because of a narrow strip of water bordering Iran and separating the Persian Gulf from the Indian Ocean: The Strait of Hormuz.

About 20% of the world's oil supply passes through there daily.

Since the start of the war, Iran has attacked several ships in the strait and threatened tankers that try to pass through it, effectively closing it off.

That's sent the price of a barrel of oil up more than 10% since the weekend.

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President Trump downplayed the effects on Tuesday.

"If we have a little high oil prices for a little while. But as soon as this ends, those prices are going to drop, I believe, lower than even before,” he said.

But later he announced a plan aimed at getting oil moving again, promising political risk insurance for maritime trade traveling through the gulf -- and potentially even U.S. Navy escorts for tankers moving through the strait.

So how high could prices get? A look back could offer a guide.

After Russia invaded Ukraine in 2022, prices rose nearly a dollar in just 30 days. But after last year's June strike on Iran, prices actually fell over the following 45 days.

In this case, the status of the Strait of Hormuz could be key in determining what long-term impact this conflict has on prices at the pump.

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