100 days into Iran war, Americans face higher prices

Published 7 June 2026 · us

On average, US households have spent $750 more in expenses due to the war, hitting middle- and lower-income people hard. A hundred days into the

On average, US households have spent $750 more in expenses due to the war, hitting middle- and lower-income people hard. A hundred days into the US-Israel war on Iran, Americans are facing increasing financial pressure at the pump and at the grocery store in an economy already facing headwinds from United States President Donald Trump’s domestic and foreign policies, including tariffs. The war is unpopular, with 66 percent of Americans disapproving of Trump’s handling of the conflict with Iran, according to a recent CBS News poll. That echoed comparable findings in an ABC News/Washington Post Ipsos poll that found that 61 percent of Americans said that military action in Iran was “a mistake”. US consumers are especially feeling the pinch in their wallets. On average, households have spent $750 more in expenses due to the war, according to an analysis from Moody’s Analytics. The bulk of the spending is on energy-related expenses, with Americans spending an average of $447.19 more than usual. “This is a big economic blow,” Mark Zandi, chief economist at Moody’s Analytics, said in a post on X on the heels of the report, adding that the burden hits “already hard-pressed middle- and lower-income households”. “Folks at middle income or lower income, they spend a bigger proportion of their income on goods and services each month than people at the higher levels of income who can save,” Michael Klein, professor of international economic affairs at The Fletcher School at Tufts University, told Al Jazeera. “They spend more of their income on housing and food. And the prices of these have been going up by a lot.” Petrol prices surged on Friday to $4.22 per gallon (3.78 litres) for regular fuel, compared with $2.98 per gallon on average on February 28, the day the US and Israel first struck Iran, according to the American Automobile Association (AAA), which tracks daily fuel prices. Since then, Iran has retaliated by attacking energy infrastructure in the region and by throttling traffic through the Strait of Hormuz, from which a fifth of the world’s oil and gas is exported, sending prices for those commodities soaring. Overall, inflation has surged, with energy prices being the driving factor. The cost of energy jumped 5.5 percent in the latest Personal Consumption Expenditures (PCE) report released by the Department of Commerce, which is one of the US Federal Reserve’s closely watched gauges for measuring inflation when deciding interest rates.

Inflation, overall, jumped to 3.8 percent from 3.5 percent the month prior, marking the biggest increase in three years, according to the PCE. As a result of these economic strains, Americans are opting to work from home or cut back on plans that involve driving. A survey by American Muscle, a platform that sells car parts, found that 12 percent of Americans are choosing to work remotely more often amid heightened petrol prices, while a Washington Post/ABC News Ipsos poll found that 44 percent of Americans said they are driving less for that reason. Consumer sentiment is tumbling, driven by high gas prices. The University of Michigan consumer sentiment tracker fell to 44.8 in the May survey, down from 49.8 in April and below last May’s 52.2, largely because of energy prices. “Consumer sentiment fell for the third straight month as supply disruptions in the Strait of Hormuz continue to boost gasoline prices,” the University of Michigan said in a release accompanying the report. That is echoed by a McKinsey survey, which found that sentiment is at its lowest level in two years. Consumer spending is tumbling as well, with two-thirds of US consumers pulling back on spending because of rising costs, according to The Conference Board’s consumer confidence report. The increased cost of fuel has put a strain on the airline industry. Last month, Spirit Airlines ceased operations after more than three decades. In court filings, the budget carrier attributed its closure to an increase in fuel prices. Other US carriers have adapted their pricing to account for heightened fuel costs, including United Airlines, which, in late April, announced it would raise fares by up to 20 percent. Overall airline prices have jumped since the war began. Airfare prices rose 2.7 percent in March and another 2.8 percent in April, according to the Labor Department’s Bureau of Labor Statistics. Consumer expenses hit While inflationary pressures have mostly hit the energy market, they have also started to affect downstream consumer expenses, including the cost of food. In April, food prices jumped 0.5 percent, marking the biggest increase since November 2022. Pressure on the cost of food is expected to worsen. The Gulf region is a major supplier of both nitrogen and sulphur used in the fertilisers farmers need for food production.