As the war rages on in Iran, many Americans are starting to feel the impacts on their wallets as prices skyrocket. The longer the overseas conflict lasts, the larger the impact on the global economy, including the U.S.
The 2026 war on Iran officially began on Feb. 28, when Israel and the U.S. started bombing the Middle-Eastern country, killing Iran’s Supreme Leader Ali Khamenei. In response to the attacks, Iran blocked the Strait of Hormuz, a vital passageway used by oil-carrying ships. According to Forbes, the shipping passage “accounts for 20% of the world’s oil every day.”
Since Iran began its blockade, threatening to attack any ships that attempt to cross through, the price of oil has increased. According to The New York Times, the price of oil surged to $100 per barrel, and it may be “the worst disruption to oil supplies in history.”
As a result, gas prices are already rising, with the national average price per gallon (as of March 29) reaching $3.980, according to data from the American Automobile Association. In Kentucky, the average price for that same day was $3.717. In comparison, at the same time last year, the national average price per gallon was $3.159, while Kentucky’s average price was $2.831.
When fuel prices rise, so does the cost of everything else, as it costs more money to transport goods like groceries or household items. In an ABC News article, economist Mark Zandi said the cost of fuel is directly linked to inflation.
“For every $10 increase in the cost of oil, the overall U.S. inflation rate is expected to rise 0.15%,” Zandi said.
The Middle East provides the U.S. with more than just oil; it also exports a large amount of fertilizer, which may make it harder for farmers to afford as planting season approaches — potentially causing a spike in the cost of food.
According to CNBC, “More than one-third of globally traded fertilizer passes through the Strait of Hormuz, making it a critical artery for agricultural supply chains.” With the blockage of the strait, shipments of fertilizer have been disrupted at a critical stage in the planting process. Fertilizer is applied early in the crop cycle, and its usage can increase crop yield.
If access to fertilizer is limited for American farmers, there could be a drop in the amount of crops produced and a surge in the price of groceries. Since the war began, farmers have already seen a 25% increase in the cost of fertilizer.
President Trump visited Hebron, Kentucky, earlier in March, where he said the country’s economy is thriving and pointed to a boom of “8,000 construction jobs in Kentucky.” He also said the surge in oil and gas prices is temporary and will decrease once the conflict is over.
