American consumers have spent an estimated $100.9 billion more on gasoline and diesel since the war began in late February, according to a cost tracker published by Brown University's Watson
American consumers have spent an estimated $100.9 billion more on gasoline and diesel since the war began in late February, according to a cost tracker published by Brown University's Watson School of International and Public Affairs.
The estimate compares actual fuel prices with what researchers calculate consumers would have paid without the war, equivalent to about $770 per household.
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Gasoline has climbed above $4.15 a gallon, while diesel reached a record $5.90, up from $3.76 before the conflict. Higher diesel costs can spread quickly through the economy because trucks, trains and farm equipment run on the fuel.
"We're looking at a fall that's going to be the most expensive ever for gasoline, but really for diesel," Gulf Oil chief energy adviser Tom Kloza told CNN, adding that it would "fuel every aspect of inflation."
Goldman Sachs has warned that oil could surge to $120 a barrel if attacks on Middle East shipping do not stop, Daan Struyven, the bank's co-head of global commodities research, said in a Bloomberg TV interview Monday. Brent crude is on track to pass $100 a barrel for the first time since July.
August inflation data, due Friday, is expected to show consumer prices rose 3.4% from a year earlier, still well above the Fed's 2% target. Markets are leaning toward a September rate hike even as President Donald Trump presses policymakers to hold or lower rates.
Traders on prediction market Kalshi price a 57% chance of a quarter-point increase at the Sept. 16 meeting, against 44% odds that the Fed holds steady and 1% on a larger hike.
Fed funds futures tracked by CME Group's FedWatch tool put the odds of a hike at 60%, CNBC reported Wednesday.
"History demonstrates that the most reliable way to restore price stability is to maintain sufficiently restrictive monetary policy until inflation is decisively tamed," Mark Higgins, senior vice president at Index Fund Advisors, told CNBC.
Higher interest rates raise returns on safer assets and tighten financial conditions, which tends to reduce demand for riskier investments such as Bitcoin and other cryptocurrencies.
The oil shock has also created an unlikely venue for traders looking to bet on energy prices: decentralized derivatives exchange Hyperliquid.
Hyperliquid specializes in perpetual futures, or "perps" - contracts that let traders bet on an asset's price without owning it and that, unlike traditional futures, have no expiration date. Its infrastructure lets third parties deploy markets for real-world assets such as stocks, commodities and oil.
Oil trading on the platform took off when the war began. "When the Iran war began in February, late on a Friday, New York time, I believe the only place that oil traded for about 48 hours following that was on Hyperliquid," David Schamis, CEO of Hyperliquid Strategies, said on the company's Aug. 27 earnings call.
The venue had only offered oil for a few weeks at the time, he said, yet became the only place where "any real volume was traded for a full 48 hours" while traditional markets were closed.
That market has since become sizable. The BRENTOIL-USDC perpetual, deployed by trade.xyz on Hyperliquid, had recorded about $187.8 million in 24-hour volume and $243.1 million in open interest at the time of writing.
Brent was trading near $99.77 on the platform, up 3.3% over 24 hours, within striking distance of $100 a barrel.
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