Gas prices drop as U.S.-Iran peace deal looms

ROCHESTER, Minn. (KTTC) – A potential peace deal between the U.S. and Iran had drivers watching what it could mean for prices at the pump. Over the last five weeks, gas prices have dropped across the country and in Minnesota.

Nationwide, prices fell 63 cents per gallon in the last month. The average is now about $3.90 per gallon. Those prices may continue to fall over the next few weeks as long as the deal is signed.

GasBuddy’s head of petroleum, Patrick DeHaan, said the biggest element is whether ships are able to sail in the Strait of Hormuz.

“The big risk is that if this deal doesn’t happen, oil prices are likely to snap right back up,” DeHaan told KTTC.

DeHaan also warned that, even if a deal is signed, gas prices likely won’t return to pre-war levels until 2027.

“The world has missed out on over a billion and a half barrels of oil since the strait’s been closed for 115 days,” DeHaan explained, “And that’s going to take a much longer period of time to recover from. So even if the deal does get signed, there is a long-term pace to recovery.”

Diesel is expected to follow the same trend as gasoline, which DeHaan said is good news for farmers, truckers and airlines. But diesel is subject to the same vulnerability as gas, and will go back up in price if the deal isn’t signed.

The U.S.-Iran peace deal is expected to be signed on Friday.

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