US gasoline reached $3.84 per gallon on 18 March — up $0.86, or 29%, from pre-war levels. Diesel hit $5.07, the highest since the aftermath of Russia's invasion of Ukraine in 2022 1. Fortune reported that economists estimate March inflation could reach 1%, the steepest monthly increase in four years 2. Two days earlier, The National average stood at $3.79 for gasoline and had just crossed $5 for diesel . Prices are now rising day to day.
Diesel is the transmission mechanism. It powers long-haul freight, agricultural machinery, and construction equipment. A 34% increase feeds through to food, building materials, and consumer goods within weeks. The Federal Reserve faces a supply-driven price shock that monetary policy cannot resolve — the last comparable disruption, following Russia's 2022 invasion of Ukraine, contributed to US inflation peaking at 9.1%. The difference: that shock originated from a foreign adversary's war. This one originates from American military action.
The structural danger sits in European gas markets. The Atlantic Council warned that European gas storage stands below 30% — a five-year low — as the April-to-October refill season begins 3. Europe depends on Qatari LNG: Ras Laffan processes approximately 77 million tonnes per year, roughly 20% of global supply. That facility sustained "extensive damage" on Tuesday. No alternative source exists at comparable scale — US LNG exports are committed under long-term contracts, and Australian output flows primarily to Asia-Pacific buyers. If repairs take weeks rather than days, Chatham House's assessment that the Eurozone would "probably" contract in the second quarter moves from scenario to forecast.
Brent Crude reached $110.90 — up from $67.41 before the war, a 64% increase in 21 days. The European gas benchmark jumped more than 30% in a single session 4. The IEA's record 400-million-barrel strategic reserve release failed to hold oil prices below $100 . Each successive disruption — Kharg Island strikes , Gulf oil exports falling at least 60% , three UAE gas facilities offline , now Ras Laffan — has outpaced every stabilisation measure attempted.
