Trump downplays inflation pain as Iran war drives gas prices higher
Gasoline jumped above $4.50 a gallon as April inflation hit 3.8%, while Trump said Americans’ financial strain was not driving his Iran decisions.
Gasoline is doing the quickest damage. U.S. consumer prices rose 3.8% in April from a year earlier, the fastest annual increase in about three years, while gasoline prices climbed 5.4% from March and were up more than 28% from a year earlier. On Tuesday, the AAA national average for regular gasoline was above $4.50 a gallon, and 51% of Americans in a CBS News/YouGov poll said higher gas prices pose a financial hardship or difficulty.
The shock is not confined to drivers at the pump. Higher fuel costs ripple into grocery deliveries, shipping charges, airfares and monthly household bills, especially when oil markets stay tight. Economists warn that even a short conflict can leave a long trail of higher prices if supply routes remain constrained. The Strait of Hormuz normally carries about one-fifth of the world’s oil supply, and the broader risk is that energy costs stay elevated long after the fighting ebbs.
The Federal Reserve Bank of Dallas has put numbers on that risk. Under a current-supply-shortfall scenario, it estimated the war could add 0.6 percentage points to fourth-quarter 2026 headline PCE inflation and 0.2 percentage points to core PCE inflation. Patrick De Haan of GasBuddy said national gasoline prices could reach $5 a gallon as early as June if the Strait of Hormuz does not reopen soon. Mark Zandi of Moody’s Analytics said the damage from higher oil prices was already done and could linger for months, while Lydia Boussour of EY-Parthenon said oil prices were likely to stay above prewar levels through 2026, with knock-on effects for consumer costs, homebuying and travel.
Donald Trump, however, said inflation pain was not steering his approach to Iran. Asked Tuesday about negotiations, he said, “I don’t think about Americans’ financial situation” as a motivation and said the “only thing that matters” was preventing Iran from developing a nuclear weapon. He made the comments before leaving for a trip to Beijing for a meeting with Chinese President Xi Jinping. Secretary of State Marco Rubio has argued that a nuclear-armed Iran could manipulate oil markets and push gas prices to $8 or $9 a gallon, underscoring how the administration is framing the conflict as a security fight first, even as inflation returns to the center of household budgets.
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