Labor Day "The Most Expensive Tank of Gas"! National average gasoline price in the U.S. surpasses $4, setting a historical high for the holiday.

At the end of summer, gasoline prices have surged, causing U.S. drivers to face the highest fuel costs recorded for the Labor Day holiday this year. The Labor Day weekend is one of the busiest travel weekends of the year (according to data from rental company Hertz), which means that the cost of road trips may be more expensive than in previous years. According to data from the American Automobile Association (AAA), the national average price for regular unleaded gasoline reached $4.15 per gallon on Monday, a record high for this holiday. AAA's data indicates that gasoline prices had never surpassed $4 per gallon before Labor Day, with the previous record set at $3.82 per gallon on September 3, 2012. AAA also noted that while current prices have decreased from a peak of $4.56 per gallon in May 2026, they are still about 30% higher year-on-yeardrivers paid an average of about $3.20 per gallon at the same time last year. "Although gasoline demand typically declines after the summer driving season, leading to lower prices, this year high crude oil costs have offset seasonal trends," said Brittany Moyer, an AAA spokesperson. Meanwhile, diesel prices have also hit a historical high ahead of the long weekend. On Monday, diesel was reported at $5.90 per gallon, compared to just $3.71 per gallon a year ago. Global oil supply remains constrained As of 9:30 AM Eastern Time on Monday, U.S. benchmark West Texas Intermediate (WTI) crude oil futures were trading around $92 per barrel, compared to about $67 per barrel before the outbreak of the Iran war on February 28. Similarly, international benchmark Brent crude oil futures were reported at approximately $97 per barrel on Monday, significantly higher than the pre-war level of around $72 per barrel. During the conflict, oil prices have continued to fluctuate sharply due to tanker traffic being restricted in the Strait of Hormuz, limiting global supply. Crude oil is the primary raw material for gasoline, typically making up the largest component of retail prices. According to data from the U.S. Energy Information Administration (EIA), approximately 4.9 million barrels of crude oil and petroleum products traveled through the Strait of Hormuz each day in the second quarter of this year, a significant drop from the average of 21.6 million barrels per day in the fourth quarter of 2025, before the Iran conflict began. At the same time, some refineries have halted production due to the Iran war and the Russia-Ukraine conflict, further constraining gasoline supply. "Supply disruptions in the Middle East are ongoing, and refineries in the region and Russia are damaged by regional conflicts, reducing the amount available for market," said Andy Lipow, president of Lipow Oil Associates, a consulting firm focused on refinery operations analysis. EIA data shows that for the week ending August 28, U.S. gasoline inventories were 6% lower than the average level. Winter blend gasoline may ease retail pressure However, Lipow pointed out that there may be a positive factor arriving soon to alleviate high oil prices. "The good news for consumers is that the industry will switch to winter-grade gasoline in September, which will provide some relief at the retail level," Lipow stated. According to EIA data, winter gasoline is usually cheaper due to lower production costs. Summer gasoline uses a more expensive formula, which typically ceases production around September 15. This year, to increase supply and lower prices, the U.S. Environmental Protection Agency announced on August 20 that winter blend gasoline could be made available for sale starting September 1, effectively ending the mandatory use period of summer blend gasoline early. However, experts say that global oil supply remains a key variable determining gasoline price trends. "The market is watching to see if the U.S. and Iran can reach some sort of agreement that would fully open the Strait of Hormuz to all shipping," Lipow said.