Oil at $100 Per Barrel: U.S. Consumers Better Prepared Than Feared
Despite oil prices surging amid the Iran conflict, U.S. households display unprecedented resilience. Energy accounts for just 2% of consumer spending, the lowest share in 80 years.
| Countries | États-Unis, Iran, Ukraine |
|---|---|
| Companies | OMV |
| Sector | Pétrole, Carburants |
| Theme | Marchés & Finance, Prix |
The closure of the Strait of Hormuz, following U.S. and Israeli strikes against Iran, represents one of the most severe energy supply shocks in decades. Crude oil surged to $83 per barrel, while the S&P 500 and Nasdaq each shed 5%, wiping out more than $3 trillion in U.S. market capitalization. Yet several fundamental indicators suggest American households are better positioned than during previous oil shocks.
Energy Spending at Historically Low Share of Household Budgets
According to the Bureau of Economic Analysis (BEA), gasoline and energy products accounted for just 2% of total U.S. consumer spending in the fourth quarter of last year — the lowest share in 80 years. By comparison, this figure peaked at around 6% between 1980 and 1981 during the last major oil shock. In 2008, when crude nearly reached $150 per barrel, and in 2022 when U.S. crude peaked at $130, the ratio remained well above current levels. U.S. commercial crude oil inventories also surged by 6.2 million barrels, signaling available supply despite mounting geopolitical tensions.
Household balance sheets have never been stronger. Federal Reserve data indicates household net worth reached 794% in the fourth quarter of last year, its highest level since early 2022. Since the 1950s, this ratio has been exceeded only three times, all during the pandemic-distorted period of 2021-2022. The unemployment rate stands at a historically low level, reinforcing households' ability to absorb higher energy costs.
Pump Prices Rising Sharply
Pressure at the pump remains palpable. According to the American Automobile Association (AAA), the national average gas price now approaches $4 per gallon, up 35% in a single month. The Energy Information Administration (EIA) puts the figure at $3.72, up 27% since the start of the conflict — the highest in more than two years. Following Russia's invasion of Ukraine in February 2022, pump prices remained above $4 for six consecutive months before reaching a peak of $5 in June of that year.
Energy Inequality, a Growing Social Reality
The overall resilience of households masks deep social disparities. A Fed study reveals that one in five U.S. households is "energy burdened," meaning its average ratio of energy expenditure to disposable income reaches 25%, compared to just 7% for non-burdened households. These households are concentrated primarily in the bottom two income quintiles. Rising oil prices could also spread across the broader economy, affecting transportation, manufacturing and other industries.
Iran Conflict Could Surpass Ukraine Crisis in Energy Impact, Says OMV
On the global supply front, the Iran conflict could outpace the Ukraine crisis in severity. Alfred Stern, chief executive of Austrian energy group OMV, contends that the confrontation pitting the United States and Israel against Iran could reduce global energy supply more than Russia's invasion of Ukraine in 2022. While the Ukraine conflict primarily triggered a rerouting of energy flows, he argues, the Iran war is directly reducing volumes available on global markets. Now in its fourth week, the conflict has damaged major energy facilities in the Gulf, with its economic effects already being felt in lower-income countries.
