NJ Gas Prices Rise Amid Iran Turmoil: Will They Go Up Even More?

NEW JERSEY – New Jersey may already be paying the price of United States' conflict with Iran – at the pump. Prices have gone up as tensions between the two nations have lasted for weeks, and peaked with the drone strike of an Iranian general last week.

Gas prices have risen in New Jersey to an average of $2.63 per gallon, a 5-cent rise from the week before. Oil prices were above the $60 mark on Friday as turmoil in the Middle East played into the price increases, said Tracy E. Noble, manager of public and government affairs for AAA Mid-Atlantic.

The average price is also 27 cents higher than it was a year ago, according to AAA (see average prices in New Jersey below).

Noble and others, however, say it's too early to tell if the American drone strike outside of Baghdad International Airport, ordered by President Trump, that killed Iran's Gen. Qassem Soleimani and several others on Friday will impact the pump even more.

“Like motorists, AAA is watching the current situation in the Middle East in terms of potential short- and long-term impacts to crude oil and gasoline prices," she said. "At this point is too soon to speculate.”

President Trump has indicated that tensions could continue, saying in a tweet Friday that Soleimani had "killed or badly wounded thousands of Americans over an extended period of time, and was plotting to kill many more . . . but got caught!"

He also indicated that the United States is ready to bomb Iranian targets if the nation retaliates.

Tom Kloza, an analyst with the Oil Price Information Service, told Patch that New Jersey could see prices top $3 a gallon by March if Trump follows through on his threats. But Kloza doesn't think Trump will allow it to happen.

"Trump won't tolerate gas prices above $3," he said.

He said that tensions could be balanced by more oil that's expected to enter the market that's not coming from the Middle East.

Patrick DeHaan, head of petroleum analysis for Gas Buddy.com, said New Jersey won't see a sizable impact to gas prices unless Iran attacks.

"And even then, it depends if they attack oil infrastructure," he said. "Certainly there is not a guarantee of gas prices being impacted."

Following the U.S. airstrike on Iran, oil markets will have to deal with a lot of “what-if” situations ranging from possible diplomatic disagreements to full on attacks on the Middle Eastern oil infrastructure, Noble said.

Some analysts see Friday’s market reaction to the event as temperate, citing the reaction to last year’s attacks on the Saudi oil installation at Abqaiq in mid-September, she said. Following those attacks, oil prices jumped $8 to $9 per barrel, but dipped down less than three weeks later.

Here are the average prices in New Jersey – and how they compared to earlier milestones: