The ongoing conflict between the U.S. and Iran has led traders on the prediction market platform Kalshi to adjust their forecasts for gas prices, indicating a 75% probability that prices will be above $3.50 per gallon on November 3, up from previous estimates of 37%.
Additionally, there is a 39% chance that prices will exceed $3.75 per gallon, reflecting a notable increase in expectations following the recent escalation in hostilities. As of Thursday, the national average gas price was reported at $3.84, a rise of 5 cents from the previous day, coinciding with fluctuations in U.S. oil prices, which peaked at $75 per barrel before settling below $72.
While traders anticipate that gas prices will remain elevated, they do not foresee a return to previous highs, assigning only a 43% chance that prices will surpass $4.60 this year. This marks an increase from earlier predictions of about one-in-three odds prior to the renewed conflict. The national average for gas prices had been below $3 per gallon before the tensions escalated