US Households Pay $860 More for Energy as Iran War Adds $115 Billion
Updated
Updated · Fox Business · Sep 10
US Households Pay $860 More for Energy as Iran War Adds $115 Billion
3 articles · Updated · Fox Business · Sep 10
Summary
$115 billion in extra gasoline, diesel and jet-fuel costs has hit U.S. consumers this year, equal to about $860 per household, Moody's Analytics chief economist Mark Zandi said.
Higher oil prices are the main channel: the Iran war has disrupted flows through the Strait of Hormuz, where about 20% of global oil supply normally passes, leaving tanker traffic well below pre-war levels.
Lower- and middle-income households are absorbing the sharpest strain, Zandi said, with after-inflation incomes near a standstill or falling while gasoline stays above $4 a gallon.
Bigger tax refunds helped cushion the shock through roughly May or June, but that support has faded and households remain exposed to elevated fuel costs.
Oil prices could ease if supplies normalize, but Zandi said they are unlikely to return to pre-war levels soon because reserve drawdowns, replenishment needs and higher tanker insurance premiums will keep costs elevated.