Memorial Day sticker shock: Gas prices near all-time highs

By Matt Egan, CNN

New York (CNN) — Tens of millions of Americans hitting the road this Memorial Day weekend will face historically high gas prices.

The war with Iran has destabilized the global energy system, pushing up pump prices across the country despite emergency steps from the Trump administration designed to limit the damage.

The sticker shock on Memorial Day, the unofficial start of the summer driving season, adds to the cost-of-living frustrations that have soured voters on the Trump economy.

GasBuddy, a crowdsourced fuel price platform, expects the national average will be about $4.48 a gallon this Memorial Day. That would be 42% above the price last Memorial Day and the second-highest on record, according to GasBuddy.

The only time gas was more expensive on Memorial Day was in 2022 when the average was $4.61 a gallon in the wake of Russia’s invasion of Ukraine.

Unfortunately, pump prices may not be done rising.

Patrick De Haan, GasBuddy’s head of petroleum analysis, told CNN he expects the national average for regular gas will hit $5 a gallon at some point next month if the Strait of Hormuz remains closed.

For the summer (between Memorial Day and Labor Day), GasBuddy expects a national average of $4.80 a gallon. That would surpass the prior summer record of $4.43 per gallon set under President Biden in 2022.

“Prices were incredibly stable last summer. This summer is probably the complete opposite, perhaps the most volatile,” De Haan said, adding that his summer forecast hinges on what happens with the Strait of Hormuz.

‘It’s just insane’

Despite the high cost of gas, a record 39.1 million Americans are expected to travel by car this Memorial Day weekend, according to AAA. That’s little changed from 39 million last year.

The spike in pump prices is especially painful for those who have long commutes. Chris Haenel, a Pittsburgh resident, estimates he spends $80 a week on gas compared to $50 before the Iran war.

“Every day, I drive by the gas station and it’s just insane,” said Haenel, who fixes computers for a living.

The surge in gas prices pushed the US inflation rate to nearly 4% in April. For the first time in three years, real wages (adjusted for inflation) are shrinking. In other words, consumer prices are going up faster than paychecks.

“Everything goes up – except the paycheck. My wife comes home with three bags of groceries and it’s $300,” Haenel said. “I’m 60 years old and trying to save for retirement, but this is limiting how much I can save.”

A $24 billion hit to consumers

Americans are facing an estimated $43 billion spike in energy costs since the Iran war started, according to estimates from Brown University’s Climate Solutions Lab. That estimate is based on the current price of gasoline and diesel relative to where prices would likely have been without the war.

Gasoline alone is now costing consumers about $24 billion, amounting to nearly $200 per household, according to the Brown research.

Voters are frustrated with how President Donald Trump has handled what used to be a signature issue for him. Just 21% of Americans approve of Trump’s performance on gas prices, according to a CNN poll released last week. A majority of Republicans disapprove of his handling of gas prices.

The vast majority of Americans (75%) say the war with Iran has had a negative effect on their finances, the CNN poll found.

“President Trump remains committed to fully unleashing American energy dominance, lowering costs, and putting more money back in the pockets of hardworking American families,” said Taylor Rogers, White House spokeswoman. “As the president continues to exert maximum leverage over Iran with the ongoing successful blockade to bring this conflict to an end, we will see global energy markets stabilize and gas prices plummet back to the multi-year lows Americans enjoyed prior to the start of Operation Epic Fury.”

Trump on gas prices: ‘This is peanuts’

The White House has taken a series of break-the-glass steps aimed at putting a lid on gas prices, including releasing record amounts of oil from the Strategic Petroleum, waiving the Jones Act, invoking the Defense Production Act and pausing Russian oil sanctions.

Trump on Tuesday dismissed the spike in gas prices.

“This is peanuts,” Trump told reporters. “I appreciate everybody putting up with it for a little while. It won’t be much longer.”

Trump has argued that a temporary spike in energy prices is a small price to pay for the security benefits of preventing Iran from getting a nuclear weapon.

Gary Auerswald, a retiree living in Illinois, disagrees.

“It’s not a small price to pay. It’s a big price. He doesn’t care about us,” Auerswald said of Trump.

Auerswald, a retired mechanic and welder, said he and his wife were already struggling to get by as they live off Social Security. Now energy prices are forcing them to make tough decisions on their spending.

“The high price of gasoline is killing us. It’s a back-breaker,” he said.

Auerswald said he’d like to visit his 3-year-old great-granddaughter in Northern Illinois but won’t make the trip because of high gas prices.

“We can’t see her because that’s a long and expensive drive,” he said. “We’re basically pinned at home.”

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