Labour Day 2026 Gas Prices: Average Regular Fuel Hits Record High of $4.15 Amid Iran War Disruption

US motorists faced record Labour Day gasoline prices on Monday, 7 September, with AAA's national average for regular gasoline reaching $4.1505 (£3.07) a gallon. The holiday price was nearly $1 (£0.73987) higher than a year earlier as the conflict involving the United States and Iran continued to disrupt energy markets and shipping through the Strait of Hormuz.

AAA said regular gasoline had never previously averaged more than $4 (£2.96) a gallon on Labour Day. The previous holiday record was about $3.82 (£2.83) a gallon in 2012. Monday's average remained below the all-time U.S. regular-gas record of about $5.02 (£3.71) a gallon set in June 2022.

Labour Day Gas Prices Reflect Supply Disruption

Gasoline prices rose sharply after the United States and Israel launched strikes on Iran in February. Shipping through the Strait of Hormuz, a crucial route for global energy supplies, has since remained heavily disrupted. Reuters reported that commodity-vessel traffic through the strait fell to its lowest level since May over the weekend as military exchanges intensified.

Tom Seng, assistant professor of professional practice in energy finance at Texas Christian University, told The Associated Press that the Iran conflict and disruption in the Strait of Hormuz were central factors behind the increase in fuel prices.

The pressure has been even more pronounced for diesel. The national average reached about $5.85 (£4.33) a gallon on Friday, an all-time record, according to AP. Reuters also reported record diesel prices as renewed U.S.-Iran hostilities and disruptions linked to Ukrainian attacks on Russian refineries tightened global supplies.

Higher diesel prices can affect costs beyond filling stations because trucking and other freight systems depend heavily on the fuel. That can increase transportation expenses for businesses moving food, parcels and other goods, although the extent to which those costs reach consumers varies by company and market.

Energy Secretary Chris Wright acknowledged on ABC's 'This Week' on Sunday that gasoline prices were higher than they were during Labour Day 2025. He said the Trump administration was working to increase production and pointed to futures markets as evidence that wholesale gasoline prices could decline later in the year.

Wright said November gasoline futures were about 35 cents a gallon below current prices. Futures prices, however, reflect market expectations and do not guarantee what motorists will ultimately pay at the pump.

Refineries Add Another Risk for Gas Prices

Seasonal trends would normally give drivers some relief after the summer travel period, when demand eases and refiners begin producing cheaper winter-blend gasoline. This year, unusually high refinery use and the risk of weather-related outages could complicate that pattern.

The US Energy Information Administration said refinery utilisation reached 98% for the week ending 28 August, up from 97.4% the previous week. The figures showed refineries operating at a high utilisation rate heading into the Labour Day period.

Seng told AP that unusually harsh heat affecting Texas refineries, combined with the possibility of hurricane-related disruptions, could make a seasonal drop in prices more difficult if facilities were forced offline.

Global supply concerns are adding to that uncertainty. Reuters reported that Ukrainian attacks on Russian refining facilities have contributed to tighter distillate supplies, while shipping risks in the Middle East have continued to raise concerns about crude and fuel supplies.

Matthew Metzgar, a clinical professor of economics at UNC Charlotte, told AP that motorists could still reduce some travel costs by comparing local prices, particularly because stations near interstate routes can charge more than those a short distance away.

For drivers travelling over the holiday, such savings remain modest compared with the wider forces influencing fuel markets. AAA's $4.1505 national average on Monday confirmed that Labour Day 2026 had set a new holiday benchmark, even as regular gasoline remained below its 2022 all-time peak.