Gas at $3.60: The Oil Shock and Electoral Pressure Force Washington to Seek Ways to Cushion the Blow for American Consumers
At the beginning of March 2026, prices for Brent and WTI crude oil exceeded the $100-per-barrel mark after rising approximately 67% since the start of 2026.
The last time such levels were recorded was in 2022, at the outset of Russia’s full-scale war against Ukraine. For the American market, this quickly translated into higher fuel costs: gasoline prices surpassed $3.60 per gallon and set a new two-year high.
This price impulse has a direct political dimension. For the Trump administration, rising fuel costs mean increased expenses in the sector that shapes perceptions of the economy in Republican districts—agriculture.
The link between oil, diesel, and planting campaign costs creates a risk to Republican positions ahead of the 2026 midterm elections. The most sensitive areas are the Midwest states—Iowa, Ohio, parts of Illinois, and Indiana. These are precisely the regions that combine high levels of agricultural production with political uncertainty in elections.
Thus, rising oil prices automatically increase the cost of diesel, mineral fertilizers, and agricultural product logistics. For American farmers, this means a 20–30% increase in planting campaign costs compared with the beginning of the year, which reduces production margins amid already strained commodity markets.
This indicator acquires strategic significance in the context of the November 2026 congressional midterm elections. The current composition of the House of Representatives, where Republicans hold a minimal one-vote advantage, will remain unchanged until the end of the term.
However, this very minimal advantage means that even a limited electoral shift in a few districts during the midterms could hand control of the lower chamber to the Democrats.
In the three previous congressional midterm campaigns, when oil prices (adjusted for inflation) stood near or above $100 per barrel at this stage of the election cycle, the party controlling the White House on average lost 29 seats in the House of Representatives.
At the same time, history shows that in addition to the price level, its dynamics leading up to election day are also key. When oil prices fall closer to the elections—as happened in 2014 and 2022—the scale of the electoral wave against the party in power usually decreases.
Currently, however, the indicators remain unfavorable for Republicans, who are trying to minimize the political consequences of instability in the Middle East.
The 2018 election experience is telling: in the spring, oil prices stood at approximately $79 in today’s dollars, yet between March and September they rose significantly—precisely during the period when voters begin to pay active attention to the campaign. In the end, Republicans lost 42 seats in the House of Representatives.
Financial markets are under pressure due to events in the Middle East. At the start of March, a wave of bond selling pushed 10-year Treasury yields to roughly 4.05%, up 30 basis points quickly. Markets now see a higher risk of accelerating inflation and growing budget costs.
Stock indices are reacting unevenly. Energy and utility companies are receiving short-term support from high resource prices, while airlines, cruise operators, and parts of industry are showing noticeable declines due to rising costs and geopolitical uncertainty.
Capital flows are also signaling a change in sentiment. According to investment bank estimates, outflows from U.S. equity funds have reached multi-year highs, with the financial sector among those that lost the most investment resources alongside technology and development companies.
It is for this reason that the Trump administration is attempting to ease the pressure from the Middle East situation using administrative tools.
On March 13, 2026, the U.S. Department of the Treasury issued a temporary license allowing transactions for the sale of Russian oil and petroleum products if they were loaded onto vessels before March 12. The license will remain in effect until April 12 and does not apply to transactions related to Iran.
According to market estimates, this decision essentially allows the completion of transit and sale of approximately 100 million barrels of Russian oil already in the logistics chain. Treasury Secretary Scott Bessent described the step as a short-term measure to stabilize energy prices.
This illustrates the paradox of the current situation: at the moment when Washington is conducting one of its largest military operations against Moscow’s Iranian ally, the United States is simultaneously partially restoring Russia’s oil revenues.
The mechanism that made this possible is not diplomacy or political concessions to the Kremlin, but internal economic pressure formed by rising American gasoline prices ahead of the midterm elections.
On March 9, 2026, Donald Trump stated directly during a speech in Florida that the United States would “temporarily lift these sanctions until the situation stabilizes” in order to lower oil prices.
He emphasized that the military campaign continues: according to him, American forces have already struck about 5,000 targets, and Iran’s missile capabilities have been reduced to approximately 10% of their previous level.
Despite this, the President stressed that the United States has no intention of halting the operation until the enemy suffers complete defeat.
However, even the temporary easing of sanctions creates new tensions in relations with allies, primarily Europe, which over the past years has tried to gradually reduce its dependence on Russian oil.
As a result, a contradiction arises between the internal economic logic of American policy and strategic sanctions coordination with partners.
Another measure introduced was the preparation of a temporary suspension of the Jones Act, which requires the use of American vessels for transporting goods between U.S. ports. The plan is that a 30-day exemption will allow foreign tankers to transport oil, diesel, gasoline, and fertilizers between domestic ports.
The economic impact of this decision is seen as limited. Even fully repealing the Jones Act would change gasoline prices by only a few cents per gallon, while the main pressure comes from global issues like shipping congestion and risks to energy transport through the Strait of Hormuz.
Another measure was the coordination of the largest-ever release of oil from strategic reserves. On March 11, the world’s 32 largest economies agreed to put 400 million barrels on the market, and the U.S. plans to release an additional 170 million barrels from its reserve.
This is almost half of the 415 million barrels that remained in the reserve after partial replenishment in previous years.
Historically, the U.S. strategic reserve held 700–800 million barrels, giving Washington the ability to respond to major energy shocks. After the 2022 energy crisis, much of this stock was used to stabilize the market, and full replenishment has been blocked by ongoing budget conflicts in Congress, which limited funding for new oil purchases.
As a result, the U.S. decision regarding the strategic oil reserve means the actual use of one of the last major rapid-response resources, reducing the United States’ ability to stabilize the market in the event of further escalation.
The further strategy for stabilizing energy markets remains undefined. The administration has rejected the most risky scenarios, including the idea of forcibly ensuring tanker passage through the Strait of Hormuz.
In parallel, the administration is attempting to demonstrate a long-term response to energy instability. Donald Trump announced a plan to build a new oil refinery in partnership with the Indian company Reliance Industries. The facility is planned for the port of Brownsville in Texas and will focus on refining American shale oil.
According to the President, this will be the first new oil refinery built in the United States in the last 50 years and will strengthen the country’s energy security while delivering a significant economic effect.
However, this step has clear limits. Reliance Industries—India’s largest private energy company and owner of the world’s biggest oil refinery in Jamnagar—sees the project as a 20-year investment. Building the facility will take years, so it cannot ease the current crisis.
All three measures used by Washington in March are short-term fixes: the strategic reserve cannot be quickly refilled, the sanctions license cannot be extended without undermining its purpose, and suspending the Jones Act barely affects prices.
A long-term solution like the Brownsville refinery will take effect well beyond the current electoral cycle. Meanwhile, price trends in the third quarter of 2026 will decide whether the administration can maintain stability until November, when voters finalize their view of the economy.
The March crisis has revealed a structural contradiction in the American model of power projection. An administration that is simultaneously striking Iranian infrastructure and restoring oil revenues for Tehran’s main ally is acting under the pressure of domestic electoral mechanics.
Washington’s opponents follow a different timeline. Decisions by Moscow, Beijing, and Tehran on energy, production, and military projects are planned for decades and aren’t influenced by votes in a few districts every two years. This difference makes the American electoral cycle a predictable vulnerability.
Price trends in the third quarter of 2026 will affect more than just control of the House of Representatives. If oil stays above $90 until September, the administration will have to choose between using its last emergency tools to protect Congress or preserving strategic resources at the risk of losing elections.
Using up the crisis-response options too early would make it harder to conduct foreign policy from a position of strength over the following two years.
