Oil tops $100; higher fuel costs push up gas, groceries and school items
NEW YORK (AP) — Oil prices pushed past $100 a barrel Thursday amid renewed fighting and military strikes in the Middle East, a move that analysts say will push higher fuel and shipping costs onto consumers already feeling the strain from earlier price jumps.
The average U.S. price for regular gasoline reached $4.09 a gallon Thursday, up 15 cents from a week earlier, AAA said. Pavel Molchanov, an investment strategy analyst at Raymond James, said pump prices are likely to keep rising in the near term because of supply-chain lags, though futures for later delivery suggest prices could fall if military action ends.
Higher oil also puts upward pressure on grocery bills, said Miguel Gomez, director of Cornell University’s Food Industry Management Program. Gomez said oil at $100 a barrel “doesn’t make food prices jump right away, but it does put upward pressure across the food supply chains,” especially for items that rely on trucking, cold storage or imported ingredients. Grocery chain Albertsons cited pressure on its core business and cut its 2026 fiscal outlook on Thursday.
Shipping and freight costs are rising as carriers add fuel surcharges and capacity tightens. AFS Logistics and research firm TD Cowen said truckload pricing is at a four-year high. Andy Dyer, CEO of AFS Logistics, said diesel was about 51 percent higher in the second quarter than in January and February and jet fuel was about 90 percent higher than a year earlier. Retailers such as Tractor Supply Co. blamed higher fuel costs for softer spring sales, CEO Hal Lawton told analysts.
The travel industry is feeling the impact as well. Airlines have raised fares and cut routes to offset higher fuel bills. American Airlines reported a sharp decline in second-quarter net income despite record revenue and strong spring travel demand, and the U.S. Energy Information Administration said jet fuel demand in the last four weeks rose 9 percent from the same period a year earlier.
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