Iran War Costs: Oil Prices Lag Expectations Despite Six-Month Conflict

The Iran war has been ongoing for six months, causing pain at the pump for Americans. The national average price for a gallon of gas has surpassed $4, and oil briefly topped $120 per barrel early in the war before retreating to around $90, which is still 30% above the prewar level.

The Iranian response to the U.S.-Israeli attack was to close the narrow but critical waterway through which 20% of the world's oil passes. This has led to increased oil prices, but surprisingly, they aren't much higher.