Average gas price in the US creeps closer to $5, despite hopes of peace with Iran

WASHINGTON — The national average price of a gallon of regular gas rose by another two cents overnight despite hopes that a U.S.-Iran ceasefire may be on the horizon. 

The national average for a gallon of regular gasoline was $4.558 on Thursday. According to the American Automobile Association, that’s up from $4.536 on Wednesday and up 10 cents from $4.457 on Monday

Diesel prices remained steady, sticking at $5.674 per gallon. That price, which remained unchanged since Wednesday, is still about seven cents off of  a record high price in the U.S..

California leads the country with the most expensive gas, according to AAA, where the average price for a gallon of regular fuel was $6.165 on Thursday. Mono County, in rural eastern California, has average gas prices of more than $7. 

Just behind California were Washington ($5.763), Hawaii ($5.662), Oregon ($5.346), Alaska ($5.213) and Nevada ($5.239), all with gas prices above $5 per gallon. Illinois appears likely to be the first midwestern state to join the $5+ club, with prices hovering around $4.997 in the state. 

As gas prices continue to climb nationwide, Circle K is rolling out a one-day fuel discount event offering drivers up to 40 cents off per gallon at participating locations across the U.S.

The convenience store chain’s “Fuel Day” promotion will take place Thursday from 4 p.m. to 7 p.m. local time at more than 5,000 stores nationwide. 

The promotion comes as the national average gas price climbed to $4.558 per gallon, according to AAA, with prices topping $6 in some states.

Circle K’s rewards members, known as Inner Circle members, will also get early access to the discount beginning just after midnight through 3 p.m. May 7.

The surging prices seemed to stabilize or even decrease for about two weeks, following a temporary ceasefire agreement between the U.S. and Iran that was indefinitely extended. 

However, the Strait of Hormuz, a vital shipping route where roughly a fifth of the world’s oil passes, has effectively remained closed or extremely limited to passage due to dueling blockades by both countries. This volatility has greatly disrupted the global oil markets. 

The main uncertainty for the global economy is where oil prices are heading because of the Iran war. Oil prices spurted higher early this week on worries that the war will keep the Strait of Hormuz closed for a long time. That would, in turn, keep oil tankers bottled up in the Persian Gulf rather than delivering crude to customers worldwide.

On Tuesday, Iranian state media implied that oil facilities in the United Arab Emirates could face attacks if the United States tries to circumvent Iran in the Strait of Hormuz.

“The incident resulted from U.S. military adventurism to create an illegal passage,” the official said about the oil facility attack, apparently referring to U.S. President Donald Trump’s latest efforts to reopen the Strait of Hormuz, a critical waterway for global energy.

Hovering just under $5 per gallon is most of the Great Lakes region. According to gas price tracker GasBuddy, states like Illinois, Ohio, Michigan and Indiana have seen the fastest increase in fuel prices in the past few weeks.

Patrick De Haan, a petroleum analyst at GasBuddy, said “refinery outages” in the Midwest have made increases more severe. However, De Haan notes that these issues have improved, which could soon offset prices. 

Oklahoma has retaken the lead as the state with the lowest gas prices at $3.988. 

For a couple of days in the past week, Georgia had the lowest average gas prices. In March, Georgia Gov. Brian Kemp suspended the state’s 33-cent excise gas tax and a 37-cent diesel tax in response to rising prices amid the War in Iran. The 60-day tax suspension is scheduled to last until May 19.

On Tuesday, AAA reported Georgia had the second-lowest average gas prices at $3.91 per gallon.  

Taxes are only one factor that influences how much the price of gas varies by state. While California leads the country in gas taxes and prices, the state with the third-highest gas prices, Hawaii, has some of the country’s lowest gas taxes. 

Distance from refineries, the volume of gas the area goes through and alternate fuel options nearby also factor into the price of gas. 

The record for the highest average price of a regular gallon of gas was set on June 14, 2022, with a national average of just over $5 during the early months of Russia’s invasion of Ukraine. 

The highest recorded average gallon of diesel, $5.816, came just five days later on June 19, 2022.

The Associated Press contributed to some of the reporting in this article.