Mar 25, 2026
The war in Iran hasn’t been easy on Americans. Gasoline prices are at their highest level (1) since October 2023 and diesel (2) has topped $5 a gallon for only the second time in history as the conflict disrupts global oil supplies.
These spikes don’t just make driving and heating more expensive. They push up the cost of a wide range of goods including groceries that rely on fuel for manufacturing or transportation.
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But not everyone sees soaring fuel costs as entirely negative. Disparate voices — including President Donald Trump and environmentalists — are making the case that Americans should see the silver lining in the situation.
In mid-March, a little over two weeks after the war’s inception, Trump declared higher oil prices a win.
“The United States is the largest oil producer in the world, by far, so when oil prices go up, we make a lot of money,” he wrote in a Truth Social (3) post.
So does he have a point? Here’s a look at whether there are upsides to the high cost of oil.
“Silver lining” pros and cons
Trump is right about America’s dominance in domestic oil production. According to the United States Energy Information Administration (4), the world’s top 5 oil-producing nations are:
- U.S. 21.91 million barrels a day (22% of the world’s oil)
- Saudi Arabia 11.13 million barrels a day (11%)
- Russia 10.71 million barrels a day (11%)
- Canada 5.76 million barrels a day (6%)
- China 5.26 million barrels (5%)
As CBS News (5) reports, oil prices averaged $70 a barrel before the war. In a typical year, U.S. producers like Shell, Chevron and Exxon Mobil would enjoy $99 billion in cash flow at that price.
With prices topping $100 a barrel, American domestic producers could rake in $63 billion more in a year — enjoying $162 billion annual cash flow.
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In theory, the resulting profits could translate into more jobs and oil production, reducing America’s dependence on oil imports over the longer term, leading to greater energy security.
But there’s a limit to this ‘silver lining,’ warns Rystad Energy analyst Thomas Liles. If oil prices keep climbing and hit $150 a barrel, average Americans could cut back — not just on gas but on everything — and send the economy “into a tailspin.”
“The question from a producer perspective is how long the good times can last, because once you get to a certain price, you see demand destruction,” he told CBS News.
Ryan Sweet, a chief global economist at Oxford Economics, told CBS News (6) that “every penny increase in gasoline prices reduces consumer spending by one and a half billion dollars over the course of a year.”
If prices rise, disposable incomes dwindle and cash-strapped consumers respond by tightening their budgets, companies will consequently make less money, potentially resulting in job losses and perhaps even a recession.
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Meanwhile, many environmentalists who have been fighting to reduce gas emissions for years would consider demand destruction as a “silver lining,” leading to reduced oil consumption and a search for alternatives like renewable energy (7), public transit (8) or even electric vehicles (9).
But millions of Americans have no choice but to use a car because they live in places where effective public transit isn’t available and they can’t afford electric vehicles.
Moreover, many environmentalists decry the Iran war for its immediate environmental costs, including pollution and related health risks from fires set off by strikes on oil facilities (10) in the Middle East.
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A harsh reality for consumers
As pundits debate the potential upside and downsides, the reality for average Americans is that gas is expensive right now.
While you can’t control global oil markets, there are ways to soften the blow. Examples include:
- Carpool when possible to split fuel costs.
- Work remotely if your job allows it.
- Keep your car well-maintained to improve fuel efficiency.
- Combine errands to reduce unnecessary driving.
- Explore side income opportunities to offset rising expenses.
At the pump and in household budgets, the costs are felt now, while potential benefits aren’t guaranteed and, in any case, generally won’t materialize for a while yet.
Article Sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
U.S. Energy Information Administration (1); Reuters (2); Truth Social (3); U.S. Energy Information Administration (4); CBS News (5, 6); Inside Climate News (7); World Bank (8); ScienceDirect (9); Global Witness (10)
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Daniel Liberto is a financial journalist with over 10 years of experience covering markets, investing, and the economy. He writes for global publications and specializes in making complex financial topics clear and accessible to all readers.
