Gas prices could fall soon if ceasefire holds: experts expect gradual relief at the pumps

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A short-lived ceasefire between the U.S. and Iran this week sent oil markets into a rapid slump, creating a window for lower pump prices — provided the calm continues. For drivers already feeling the bite of high fuel costs, the question is now whether any relief will be quick and meaningful or slow and fragile.

Global crude benchmarks dropped sharply after the two-week truce reduced immediate threats to shipping in the Gulf, with WTI and Brent futures falling from the prior session’s levels. Traders priced in fewer supply interruptions once tankers can move more freely through the Strait of Hormuz, the narrow chokepoint that carries a sizable share of seaborne oil.

How much relief at the pump?

Analysts say drivers could begin to see lower retail prices within days, with most of the near-term change modest rather than dramatic. Andy Lipow, president of Lipow Oil Associates in Houston, told reporters he expects motorists to notice a decrease starting this weekend and forecasted a drop roughly in the range of 10 to 20 cents per gallon over the next couple of weeks — assuming the ceasefire holds.

That optimism comes with a caveat. “This all depends on the truce remaining in place — if we’re back in conflict in two weeks, all bets are off,” Lipow added, underscoring the fragility of market confidence.

Where prices stand now

As of midweek, the national average at the pump hovered around $4.16 per gallon, according to GasBuddy data. That’s notably higher than the pre-conflict average just under $3 in late February, though still below the peak near $5 seen in June 2022 amid disruptions tied to Russia’s invasion of Ukraine.

The immediate fall in crude doesn’t translate one-for-one to pump prices. Refining, distribution and retail margins mean wholesale declines typically take time to filter through.

Short-term outlook: Expect modest, incremental drops at the pump within days to weeks if shipments through the Gulf remain steady.

Medium-term timeline: It could take several weeks for oil supply logistics to rebalance; consumers might see more noticeable cuts over the next one to two months.

Major caveat: Any renewed hostilities or disruptions in the region would quickly reverse the trend and push prices back higher.

Ship movement through the Gulf fell dramatically after the conflict began — UN trade data showed transits plunged from roughly 130 vessels a day before the clashes to about six per day in March. Since the ceasefire began, traffic has only slowly resumed, and full normalization of shipments would take time.

Seasonal and supply-side pressures

Even if crude becomes cheaper, other factors could blunt relief: refiners are shifting to higher-cost summer gasoline blends required by the EPA to limit emissions, and many plants are just finishing seasonal maintenance. That combination raises the production cost of gasoline at the precise moment consumer demand typically rises for spring and summer travel.

Patrick De Haan, head of petroleum analysis at GasBuddy, warns the market will likely price in a persistently higher level of geopolitical risk in the region. “Even with a ceasefire, the market is factoring in the possibility of future disruptions,” he said, noting that a one-time shutdown of the Strait of Hormuz sets a new baseline for risk premiums.

What drivers should watch next

Key indicators to monitor over the coming days and weeks:

Whether ship transits through the Strait of Hormuz return to normal volumes;

Crude price movements for WTI and Brent futures;

Refinery utilization rates and summer-blend rollout schedules;

Any diplomatic developments that extend or replace the current ceasefire.

If the truce holds and shipping stabilizes, drivers should see gradual savings at the pump, though full normalization to pre-conflict prices would likely take months. Conversely, a breakdown in the agreement would quickly reintroduce price spikes, reversing any short-term benefits.