Gas prices “will rapidly come back down,” as soon as the war against Iran ends, President Donald Trump said during his address to the nation last week.
That’s not what his Department of Energy said Tuesday.
If hostilities in the war were to stop by the end of April, the price of gas at the end of the year would still higher than it was at the start of the war, and would remain higher in 2027, according to Energy Information Administration’s Short Term Energy Outlook.
“We forecast retail gasoline prices to peak at a monthly average of close to $4.30 per gallon in April and average more than $3.70” per gallon in 2026. As much as a year from now, gas could still average as much as $3.60 nationally.
A gallon of regular was averaging $3.13 nationally prior to the war, according to the EIA.
Nevada is largely dependent on California for retail gasoline, and the price tends to cost between 20% and 25% more than the national average. For example, on Tuesday, the price of gas averaged $4.14 nationally, and $5.09 in Nevada, according to AAA.
In a statement accompanying the EIA outlook, the agency’s administrator acknowledged the projections released Tuesday could be overly optimistic.
“Our petroleum forecasts are highly contingent on the interaction of three variables,” said EIA Administrator Tristan Abbey. “First, to even run our model we have to make an assumption about the duration of the Strait of Hormuz closure. Second, we know that the closure is forcing production to shut in, but we can only estimate these outages. Third, just as we had never before seen the strait close, we’ve never seen it reopen. What exactly that looks like remains to be seen.”
But restoration of oil flows “will take months,” Abbey said.
In the meantime, “Our modeling indicates that fuel prices will continue to rise until these variables resolve,” he said.
The agency’s outlook did not include scenarios in which hostilities continued past the month of April.