What Actually Causes Gas Prices To Jump Overnight?

In March 2026, Americans saw the price of unleaded gasoline jump 11 cents overnight, the largest overnight increase since March 2022. How does the cost of gasoline increase so much so quickly? It has to do with the rapid increase in the price of crude oil, which is the unrefined oil that is then turned into gasoline.

Crude oil prices have a direct influence on the price of gasoline, and prices for the former shot up that night after the United States attacked Iran. Traders predicted it would affect global crude oil supplies, and they were proven right: Iran officially shut down the movement of oil through the Strait of Hormuz in March. Prices had climbed before that, however, as those same concerns pushed the price of crude oil up by around $8 per barrel even before the strait was shut down. Gas stations then react to these increases; as oil analyst Tom Kloza explained to Axios in March, any increase in crude oil "moves very quickly to the pump," adding that "They will rocket higher when they're moving on geopolitics like [the Iran War]."

While traders can set a new price, this sudden increase is often just the first in a series of decisions that lead to higher gas prices for consumers. Gas stations base their pricing on the cost of replacing the current gas in their tanks. When gas station owners see the price of crude oil climb, they immediately raise their prices to make sure they can afford the new gasoline they will eventually have to buy. Basically, they set prices in preparation for future purchases, not for the current supply. 

Frustrated car owners (especially ones with empty tanks that show up the following day) may see this as greed on the part of gas station owners, but gas stations don't really make more money when prices climb. More expensive gas actually makes for smaller margins, because gas stations often can't increase prices quickly enough to compensate for the higher prices they have to pay to get the gas. While Americans currently fear that prices will continue to increase if the war continues and traders stay alarmed, President Donald Trump has stated his belief that prices will be "lower than ever before" once the conflict ends, as reported by news outlets including AP News.