Metro Atlanta gas prices are up 50% since start of Iran war
Metro Atlanta gas prices shot up above $4 per gallon this week, soaring about 50% higher since the Iran war began in late February.
The conflict in the Middle East has disrupted energy production and shipping through a critical export route known as the Strait of Hormuz, where about a fifth of the world’s crude oil and natural gas flows.
The average price for regular unleaded gas in metro Atlanta was $4.20 per gallon Friday morning, up about 35 cents from a week ago, according to AAA. The average price for a gallon of diesel in metro Atlanta was about $5.23, AAA data show, up about 24 cents from last week’s price.
These elevated prices come as peak travel season approaches, which could complicate Memorial Day and summer vacation plans. Lower-income households are already reducing gas consumption, new research shows.
Companies, too, are impacted. For example, delivery service DoorDash this week said it plans to spend more than $50 million in the second quarter on gas price relief for its drivers. Atlanta-based Delta Air Lines has said high jet fuel prices could cost it billions.
“Every day is adding up to a more severe economic toll,” said Patrick De Haan, a petroleum analyst with Gas Buddy.
Metro Atlanta gas prices had lulled in late March after Gov. Brian Kemp suspended Georgia’s gas tax for 60 days, which has kept prices below national averages, which was about $4.55 for a gallon of unleaded on Friday, according to AAA data.
Gas prices also retreated in mid-April when President Donald Trump announced a temporary ceasefire with Iran, underscoring how volatile markets are in response to the news cycle. But prices have since escalated amid continued blockades in the Strait of Hormuz.
“We’ve now had several of these head fakes where a deal is close, then it’s not, then it is, then it’s not,” De Haan said. “Ultimately, there’s been no solution to open the strait, and at the end of the day, that’s all the market cares about. And until we see the strait reopen, we’ll probably continue trending higher.”
De Haan predicted gas prices could rise to $5 per gallon by June in metro Atlanta without a resolution to the war. That would eclipse the highest recorded average price for regular unleaded gas in metro Atlanta, which was almost $4.55 per gallon in June 2022, after Russia’s invasion of Ukraine.
Some motorists in metro Atlanta said they are exasperated with high gas prices.
“It is cutting into our pockets,” said Charleston resident Pinesh Patel, who was filling up his vehicle in metro Atlanta on Thursday while on business.
Patel works in information technology, and he said high gas prices are forcing him to change his schedule. Now, he said he waits until he has three or four service calls to stack into one trip.
“The timely service that people (are) used to gets delayed,” he said. “Something has to happen. We cannot live this way.”
De Haan said even upon the reopening of the Strait of Hormuz, it could take up to a year for gas prices to fully return to prewar levels.
“Global inventories are going to need a long, long time to fully recover and be built back up,” he said.
New research shows lower-income consumers have been hit the hardest by rising gas prices.
In March, households earning less than $40,000 cut their gas consumption by 7% following the Iran war but still spent 12% more on gas, according to a report from the Federal Reserve Bank of New York. And a separate report from Bank of America showed that a growing number of lower-income households are spending more than 10% of their income on gas.
Hank Siegelson, a retired Atlanta emergency room doctor, said recently more people are asking him for spare money at the pump. He spoke to The Atlanta Journal-Constitution while at a Decatur-area gas station Thursday.
“It happens every time I go get gas, and I give people money,” said Siegelson, now an adjunct professor at Emory University School of Medicine. “For people who are trying to get by to have to pay an extra $100 a month for gas, it’s just unbelievable. I feel so sorry for people, and it’s all because we have this war with no end.”
Siegelson said he believes many people are struggling.
“The pain is substantial … between health insurance, the cost of gasoline, the cost of clothing, the cost of food, the average worker right now is going to be absolutely slammed,” he said. “Can they afford to feed their kids or the elderly? Are they going to be able to have a place to live? Can they afford their medicine?”
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