Gas, Groceries, and Flights Will Stay Expensive After Iran War, Experts Warn

NEW YORK (AP) — A tentative deal to end the Iran war raises hopes for lower prices. But experts say gas, groceries, and airline tickets will not drop quickly. Even if oil flows again from the Middle East, consumers may wait weeks or months to see relief. The conflict disrupted supply chains for fuel, food, and goods like shoes. “It is not clear that anything has been achieved that makes the American consumer better off,” said Brett House, an economist at Columbia Business School. **Gas Prices** Oil prices fell after the deal was announced. But refineries pay for crude oil a month or more in advance. This means cheaper gas at the pump will take time. “The raw material takes weeks to work through the system,” said Michael Lynch of the Energy Policy Research Foundation. In areas with limited refining, like the U.S. West Coast, prices will drop even more slowly. **Flight Costs** Travelers should not expect lower airfares soon. Airlines buy fuel in advance and set ticket prices based on demand. Jet fuel savings may take weeks or months to appear. “I think it’s unlikely we’ll see a reduction in the cost of flying this summer,” House said. **Grocery Prices** Fuel makes up 15% to 30% of food costs. But price increases from the war will take months to pass through the supply chain. “We’re likely still looking at inflationary pressure on food,” said David Ortega of Michigan State University. U.S. grocery prices are expected to rise 3.2% this year, above the historical average of 2.6%. **Fertilizer and Farming** Before the war, 30% of the world’s fertilizer passed through the Strait of Hormuz. Supply was cut off, and prices soared. Many farmers now face planting seasons without enough fertilizer. The United Nations expects a “devastating impact” on crop yields. **Retail and Shipping** Shoe sellers hope lower gas prices will boost spending. But their own costs remain high. Most footwear sold in the U.S. is imported, and shipping costs are expected to stay high through 2027. Shipping experts say fuel surcharges will continue. “Higher shipping costs will be with us for quite some time,” said Josh Steinitz of ShipStation Global. The bottom line, experts say, is that getting back to normal will be slow. A deal to open the strait is just the beginning.