NJ Gas Prices Could Soar With Trump Dumping Iran Deal: How Much?

Get ready to see gas prices you haven't seen in years, New Jersey, since the Trump administration has decided to withdraw from the Iranian nuke deal, analysts say.

The US re-imposing of economic sanctions on Iran could cause gas prices to soar past $3 across New Jersey – where drivers are already paying an average of $2.90 a gallon, the most they've paid in years, this week.

Indeed, gas prices could go up by as many as 25 cents on average by mid-summer, according to petroleum analyst Patrick DeHaan of GasBuddy.com. He said the most likely increase will be 10 cents.

Motorists across the country and in New Jersey already have been paying the highest gas prices since 2014.

"I believe gas prices could rise as much as 25 cents per gallon in a very worst case scenario because of the withdraw, but more likely somewhere around 10 cents per gallon," he told Patch.

Because the withdrawal just happened, however, the situation remains fluid, DeHaan said.

DeHaan said motorists will see more moderate-to-small price increases over the next one-to-two weeks, bringing New Jersey's average very close to $3, or slightly over it.

"From there, we'll have to digest if crude oil will sustain its post-Iran surge," he said. "A solid forecast remains elusive as the situation remains fluid."

Those questions are:

• Will Iran's oil exports be threatened?
• Is there is a very real or credible long-term "threat" to their oil exports?
• Will we have unforeseeable issues that may arise from refineries, hurricanes, geopolitics?

President Trump announced Wednesday that the US would be re-imposing economic sanctions against Iran and withdrawing from the Iran nuclear deal.

The reinstated sanctions could lead to increased crude oil prices which would lead to increased gas rates later this summer, says Tracy Noble, spokesperson for AAA Mid-Atlantic.

The average price of gas across New Jersey this week is already 52 cents higher than on this same day last year, Noble said.

Prior to Trump's announcement, gas prices were expected to continue to rise until around Memorial Day, but the sanctions could mean that gas prices will continue climbing deep into the summer driving season, Noble said.

"This is a scenario of pump prices possibly going from bad to worse," says Tracy Noble, spokesperson for AAA Mid-Atlantic. "The timing, just as we head into the busy summer driving season, is not ideal".

Noble also outlined how the Iran sanctions will specifically impact gas prices, and the timing:

• Crude oil prices will see the immediate impact: Ahead of the announcement, speculation was already driving crude oil prices higher in the market.
• Motorists will not see immediate increases at the pump.
• It can takes weeks, usually month(s), for the market increase to translate over to retail prices.
• The retail increase will be dependent on how expensive crude oil price goes and the duration at which crude sells at the higher price point in the market.
• The national average also could hit $3/gallon this summer, 20 cents higher than it is today.

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