The ongoing war involving Iran has begun to affect American consumers by pushing up prices for gasoline, shipping, and mortgages, according to economists and financial experts. The conflict’s economic impact is worsening affordability challenges for millions of U.S. households already coping with inflationary pressures.
Higher Fuel Costs
Gasoline prices in the U.S. have surged to an average of $4.09 per gallon, an increase of more than $1 since the Iran war began, marking the highest level since August 2022, according to AAA data. Diesel prices have risen even more sharply, reaching $5.53 per gallon from $3.64 a year ago. These increases not only affect drivers but also industries reliant on diesel, such as farming, construction, and trucking.
Fuel price hikes are also driving up airline expenses, with jet fuel accounting for about 20% of airline operating costs. The average global airfare climbed 24% year-over-year to $465 in early March. Airlines have responded by raising fees, including baggage charges, amplifying travel costs for consumers.
Shipping and Delivery Charges Increase
The surge in oil prices has prompted delivery services to introduce or increase fuel surcharges, which are likely to be passed on to customers. The United States Postal Service announced an 8% surcharge on several mail services, while e-commerce giant Amazon will add a 3.5% fuel surcharge on sales from April 17. Major carriers FedEx and UPS have similarly implemented fuel surcharges amid rising energy expenses.
Rising Mortgage Rates Impact Housing Affordability
Mortgage rates have climbed for five consecutive weeks, with the 30-year fixed rate reaching 6.46% on March 27—the highest since September 2025. This increase follows a rise in U.S. Treasury yields, which investors are pushing up due to inflation expectations tied in part to the Iran war’s economic fallout. The 10-year Treasury yield moved from 3.96% before the conflict to 4.35% in late March.
Experts warn that the rising borrowing costs could present a major obstacle for prospective homebuyers, especially first-timers already stretched by high home prices. The Federal Reserve indicated in March that it will hold interest rates steady as it monitors the war’s impact, potentially delaying any rate cuts for the remainder of 2026.
Why it matters
The Iran conflict’s influence on global oil supply and prices is directly increasing costs for everyday expenses such as fuel, shipping, and home financing in the U.S. This exacerbates inflationary pressures and may slow economic growth if consumers reduce spending. As energy costs ripple through the economy, American households are facing heightened financial burdens while uncertainty remains over the conflict’s duration and resolution.
Background
The Iran war has disrupted oil flows, particularly through the strategic Strait of Hormuz, a vital passage for global oil shipments. Restrictions and risks in this region have contributed to increased crude oil prices worldwide. The U.S. economy, heavily dependent on oil imports and energy-intensive transportation, is feeling these price shocks across multiple sectors, affecting fuel, shipping, air travel, and housing markets simultaneously.
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