The retail price of gasoline in the United States has reached a 19-month high! Inflation may become a "roadblock" for Trump in the midterm elections.

Due to the conflict in the Middle East disrupting the region's energy supply, data from the American Automobile Association (AAA) shows that the retail price of gasoline in the United States rose to $3.32 per gallon on Thursday, the highest level since September 2024. This week, gasoline futures prices in the United States have also risen by 27%, potentially setting the largest weekly gain since March 2022. It is reported that due to the blockade of the Strait of Hormuz, Asian refineries are unable to obtain key crude oil supplies that usually pass through this waterway, leading some refineries to consider reducing crude processing. Meanwhile, U.S. refineries are also transitioning from producing winter gasoline to producing higher-cost summer gasoline, which typically drives up gasoline prices in the spring. Gasoline prices are one of the most direct indicators of inflation that Americans perceive. Although prices are still far below the peak historical value of over $5 per gallon after the Russia-Ukraine conflict erupted in 2022, the rapid increase in gasoline prices in the United States is enough to raise market concerns. The rapid rise in gasoline prices is not only undermining Trump's core political promise to suppress inflation but also casting a shadow over his economic agenda as the midterm elections approach. Analysts say that the continued rise in oil prices could have a negative impact on the Republicans in the November midterm elections, when the two parties will be competing for control of Congress. Voters are already dissatisfied with the high cost of living and Trump's economic governance. Analysts at Capital Economics previously stated in a public report that rising oil prices are a "blow to household purchasing power." The report also added, "It largely depends on how long high oil prices can be sustained. Sustaining oil prices at $80 per barrel has a relatively minor impact, contributing about 0.4 percentage points to overall inflation during the relevant period." However, it is worth noting that Trump said in an interview on Thursday that he is not worried about the escalation of the conflict with Iran leading to an increase in U.S. gasoline prices, as military action by the U.S. is his top priority. Trump said, "I'm not worried about it at all. After the crisis is over, oil prices will quickly drop. Let it rise, (military action) is far more important than a small increase in oil prices." White House seeks "stopgap" for rising oil prices The surging trend of oil prices this week has once again made domestic inflation pressure in the United States a market focus. In last month's State of the Union address, Trump had loudly touted the drop in gasoline prices and claimed that inflation was "plummeting." Now, the reversal in oil prices directly challenges this narrative logic. In this situation, the Trump administration, seeking to fulfill its promise to lower living costs under pressure from the midterm elections, is urgently evaluating various intervention tools to contain the rise in oil prices. Trump hinted at taking "upcoming action" to stabilize oil prices, and the U.S. Treasury Department announced temporary waivers for Indian refineries importing Russian crude oil. According to reports, the White House is still considering multiple options, including providing insurance coverage for oil tankers passing through the Strait of Hormuz, organizing naval escorts, and temporary waivers for fuel blending requirements. Additionally, there were reports that Trump administration officials had discussed involving the Treasury Department in buying and selling oil futures, but this controversial proposal has now been ruled out. The Trump administration is also reluctant to immediately tap into the Strategic Petroleum Reserve (SPR) because it was heavily used during the tenure of former President Joe Biden, and the current strategic oil reserve inventory rate is only about 60%. The frequent release of oil reserves has brought more complexity in terms of losses and the need for deferred maintenance. U.S. Interior Secretary Doug Burgum stated on Thursday that the Trump administration is considering a series of options to deal with the surge in crude oil and gasoline prices during the war. He said in an interview, "All options are being considered," adding that the list includes both immediate effective actions and long-term and more complex options. Burgum is scheduled to meet with Trump in Washington on Friday afternoon. More critically, the surge in oil prices is in direct contradiction to Trump's core goal of reducing government borrowing costs. Trump continues to urge the Federal Reserve to cut interest rates, with one of the main reasons being to alleviate the burden of approximately $1 trillion in federal debt each year. However, the rising oil prices are exacerbating concerns about inflation rebound, suppressing market expectations of a Fed rate cut, and also pushing up U.S. Treasury bond yields.