Gas Prices Hit Record October High as AAA Warns of Costs
Gas prices October record AAA warnings became official this week, as the motoring group said this month is on pace to become the most expensive October ever for U.S. fuel — with the national average for regular gasoline at $4.29 a gallon.
As of Friday, October 23, the national average stood at $4.29 per gallon, down about 20 cents from a week earlier but still more than $1 higher than the same time last year, according to AAA. “This month is poised to set a record as the most expensive October ever for gas prices following similar records set in August and September of this year,” AAA said in an October 22 news release.
Diesel prices remain even more painful. The national average for diesel stood at about $5.75 a gallon in AAA’s Friday snapshot, compared with $3.11 a year ago, with some real-time trackers putting it closer to $6.32 — a 74% increase from last year, according to data cited by Barron’s.
Why prices keep climbing
Ongoing instability in the Middle East and concerns over disruptions to oil shipments through the Strait of Hormuz continue to put pressure on fuel prices. Brent crude oil prices climbed to their highest level in more than five months after attacks in Saudi Arabia raised fears of further disruptions to energy supplies from the region, Reuters reported.
Brent crude futures reached $114.57 a barrel early Friday, Reuters reported, while the U.S. benchmark West Texas Intermediate hovered above $101 a barrel. Brent is up about 16.8% so far in October and roughly 4% on the week, according to Barron’s.
Attacks on infrastructure targets in Saudi Arabia, carried out by Iran-backed Houthi rebels based in Yemen, escalated this week, claiming at least three lives and disrupting activity at the kingdom’s Shaybah oil field. A New York Times report also indicated the U.S. and Israel are drawing up plans for renewed strikes on Iran after the midterms, adding to the market’s supply concerns heading into the winter fuel season.
War’s toll on American wallets
The increase in gas prices is straining already-stretched household budgets across the country. Average prices have risen more than a dollar since the U.S. and Israel first attacked Iran, according to NBC. In four states — California, Hawaii, Nevada, and Washington — average prices are at least $5 per gallon. Georgia, North Carolina, and Texas are paying the least, according to AAA data.
A Brown University analysis found the increase in gas prices since the start of the war has cost Americans more than $70 billion, according to the Economic Times.
Energy analysts said Thursday that gasoline is very unlikely to fall below $4 a gallon before the November 3 midterm elections because current market pressures remain in place, according to reporting by Particle News. The national average is the first October average above $4 on record.
Administration response
Energy Secretary Chris Wright has acknowledged the pain at the pump while insisting relief is coming. Quoted by ABC News, Wright said gasoline and diesel prices had “peaked” a few weeks ago and that the administration is working “in all different avenues” to bring them down.
On Thursday night at a rally in Sioux City, Iowa, President Trump announced the administration would use the Defense Production Act to release $150 million to expand domestic diesel and gasoline refining capacity, arguing that a lack of refineries — not crude supply — is the bottleneck. Energy Secretary Wright said the funds would be spent with private companies to bolster existing refineries.
The Trump administration has also discussed releasing diesel stockpiles in coordination with European allies, according to Fox News.
What drivers should expect
Analysts warn the geopolitical risk premium is likely to keep prices elevated. “If anything, re-escalation seems the most likely path, and even if tensions don’t re-escalate, the mere possibility is likely to keep a sizable geopolitical risk premium embedded in prices,” ING head of commodities strategy Warren Patterson said, according to Barron’s.
- National average (regular): $4.29/gallon, Oct. 23 (AAA)
- Diesel: $5.75–$6.32/gallon, up ~74% year over year
- Brent crude: ~$114.57/barrel, five-month high
- WTI crude: ~$101/barrel
- Most expensive states: CA, HI, NV, WA at $5+/gallon
- Cheapest states: GA, NC, TX
What’s next
With winter fuel season approaching and Middle East tensions unresolved, drivers should expect elevated prices through the election and beyond. RadioSea will continue tracking weekly AAA data and wholesale oil markets.