Gasoline Prices Hit Record $4.15 Per Gallon on Labor Day

Laura Olivas | Moment | Getty Images

A late‑summer surge has pushed gasoline prices to an all‑time high on Labor Day, leaving drivers paying more at the pump than ever before.

With the holiday weekend ranking among the busiest travel periods, rental car company Hertz says road trips will be pricier than usual.

According to AAA, the national average for a gallon of regular unleaded gasoline reached $4.15 on Monday, eclipsing the previous Labor Day record of $3.82 set in 2012.

Even though the price is down from a May 2026 peak of $4.56, it remains roughly 30% above the $3.20 average drivers paid a year ago.

“While gasoline demand typically falls after the summer driving season—often prompting lower prices—this year’s elevated crude costs have offset that seasonal trend,” said AAA spokesperson Brittany Moye.

Diesel prices also set a new high for the holiday weekend, averaging $5.90 per gallon on Monday versus $3.71 a year ago, AAA reported.

Global oil supply remains constrained

Vessels near the Strait of Hormuz, as seen from Musandam, Oman, Aug. 31, 2026.

Stringer | Reuters

West Texas Intermediate crude futures traded around $92 a barrel on Monday, up from about $67 before the Iran war began on Feb. 28. Brent crude, an international benchmark, was near $97 a barrel, compared with roughly $72 pre‑conflict.

Oil prices have been volatile as tankers have been blocked from transiting the Strait of Hormuz, tightening global supply. Crude oil is the primary input for gasoline and the largest component of retail fuel prices.

An estimated 4.9 million barrels of crude and petroleum liquids moved daily through the strait in the second quarter of the year, a steep drop from the 21.6 million barrels per day averaged in the final quarter of 2025 before the Iran conflict began, according to the U.S. Energy Information Administration.

Refineries have also been taken offline by the Iran War and the Russia‑Ukraine War, curtailing gasoline supply.

“We still have a supply disruption in the Middle East at the same time refineries in both the Middle East and Russia have been damaged due to conflicts in those regions, which reduces supply that reaches the market,” said Andy Lipow, president of Lipow Oil Associates in Houston.

U.S. gasoline inventories were 6 % below average for the week ending Aug. 28, per the EIA.

Winter‑blend gas could help prices at the pump

However, relief may be on the horizon. The industry is set to switch to winter‑grade gasoline in September, a blend that is generally cheaper to produce, Lipow noted.

Winter gasoline typically costs less because it does not require the more expensive summer formulation, which is phased out on Sept. 15. To bolster supply, the EPA announced on Aug. 20 that winter‑blend fuel could be sold starting Sept. 1, effectively ending the summer requirement early.

Still, experts say the overall trajectory of gasoline prices remains tied to global oil supply. “The market is watching for any U.S.–Iran agreement that could reopen the Strait of Hormuz to all traffic,” Lipow added.

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