Gas prices to rise 10 to 25 cents in coming weeks due to Israel-Iran conflict

WASHINGTON (TNND) — An immediate spike in oil prices following Israel's strikes on Iran is expected to show up at gas pumps across the United States in the coming days and weeks, pushing up fuel prices by as much as 25 cents per gallon, according to GasBuddy.

Benchmarks for U.S. and international crude oil prices rose by more than 8% Friday afternoon after Iranian ballistic missiles hit Tel Aviv in a retaliatory attack, pushing oil prices up to more than $73 and $75 per barrel, respectively.

The confrontation, which many fear could break out into a larger regional conflict in the Middle East, poses a threat to the flow of oil, according to GasBuddy's head of petroleum analysis, Patrick De Haan, a leading voice in consumer energy data.

"It’s going to mean less supply in the global market, and that’s why oil prices are jumping noticeably. It’s not necessarily because there has been disruption, it’s now that the risk has dramatically increased that tensions could escalate to a point where oil supplies do become threatened," De Haan said.

De Haan said the anxiety-driven spike in oil prices will trickle down to what motorists pay at the pump starting in a matter of days and will likely last for a couple of weeks, or longer if the conflict drags on.

“The degree of what happens from here on out depends on the degree to which Iran responds or if Israel escalates the situation or has new attacks. The more inflamed the situation gets, the more oil prices will likely rise. If the situation improves, if there’s de-escalation, then oil prices will de-escalate as well," De Haan said.

On Friday, the national average price of a gallon of regular gasoline was $3.13, according to AAA, 33 cents less than it was one year ago.

Earlier in the week, May's Consumer Price Index came in softer than expectations, easing fears for now of a tariff-induced rebound in inflation. According to the Labor Department's Bureau of Labor Statistics, the gasoline index decreased 2.6% last month and the overall energy index dipped 1%. Over the past 12 months, the gas index dropped 12% and the energy index fell 3.5%.

The geopolitical instability weighed down Friday's trading session after a generally strong week on Wall Street. The day's winners consisted of defense and oil stocks.

By the closing bell, the S&P 500 lost 1.13%, the tech-heavy NASDAQ shed 1.3% and the Dow Jones Industrial Average fell 1.79%.