Personal Finance
With gas above $4, drivers across the U.S. say they’re cutting back
Gas prices remain above $4 a gallon nationwide, and drivers across the U.S. say they’re already starting to change their spending habits, if they can.
Some say they have little choice but to keep paying more. “I have to spend—there’s no other way,” said Miranda Alcalá, a Queens resident who drives between boroughs for work.
U.S. gas prices have climbed by nearly $1 a gallon since the beginning of March to a national average of $4.14 as of Tuesday afternoon, according to the American Automobile Association. The increase comes as the war with Iran pushes oil prices higher and raises the risk of supply disruptions.
Around $4 a gallon is often where drivers start to change their behavior: About 59% of Americans say they would change their driving habits or lifestyle at that level, AAA reports. That share rises to roughly three-quarters if prices hit $5.
CNBC spoke with drivers at gas stations across the country who say they’re trying to cut back where they can — driving less, combining trips or trimming other spending — but many say their commutes and daily routines leave little room to avoid higher costs.
New York: ‘There’s no other way’
At a gas station in Brooklyn, regular gas cost about $3.89 per gallon with cash and $4.09 with credit on Thursday.
Alcalá, who works two restaurant jobs and drives between Queens, Brooklyn and Long Island, said she has seen her gas costs nearly double in recent weeks. “I used to pay like 20, 25 bucks for a full tank … now I pay 40, which is crazy,” she said.
The added cost is unavoidable because taking the train isn’t a practical alternative, she said.
Alcalá said rising costs are adding up across her budget, from gas to food. “Now I just cook at home because it’s less expensive,” she said, adding that she may cut back on going out with friends if gas prices keep rising.
At the same gas station, Barbara Skenderis, 53, a Queens mother, said driving isn’t optional. “I need gas. How else am I going to get around — take the train?” she said.
Skenderis said her days often involve long trips across the city, including taking her kids to baseball games and practices, and that she is filling up more frequently as a result.
At a BP station in Queens, regular gas was priced at $4.09 with cash and $4.19 with credit on Thursday. Deron Davis, a Brooklyn-based carpenter who drives daily and covers his own fuel costs, said the price caught him off guard as he pulled up to fill his tank.
The 42-year-old estimates he spends about $60 a week on gas and said prices at the Astoria station were far higher than what he typically pays in Brooklyn. Rather than filling up there, he put in just enough to get back to a cheaper station.
At current levels, Davis said, prices feel high: “Nobody wants to go over $4.”
Washington, D.C.: ‘I have to curtail what I would normally do’
A man looks at gas prices listed on a gas pump at an Exxon station on March 13, 2026 in Washington, DC.
Heather Diehl | Getty Images News | Getty Images
In Logan Circle, just north of downtown Washington, D.C., regular gas was listed at $4.09 a gallon as of Thursday, with premium at $4.79.
Tanner Harris, 31, an attorney who lives in Bethesda, Md., and commutes into the city several days a week, said rising gas prices are already affecting her budget, but her schedule leaves few alternatives.
“I can’t really do anything about the driving because I work late most days,” she said, adding that she’s “hesitant to rely on public transportation” for that reason.
For some, the changes are more discretionary. Zainab Kareem, 70, a retired Washington, D.C., resident who primarily drives for leisure, said she has already begun cutting back.
“I have to curtail what I would normally do in terms of driving different places, because the gas is really too expensive,” she said.
Corinne Candilis, 30, a Washington, D.C., resident who works for the government and drives every workday, said she is limiting driving outside of her commute and is more concerned about how higher fuel costs could affect the price of other goods.
She said she is not cutting back yet, but is preparing to adjust her spending. “I’m definitely looking at my budget to see where I’ll be able to make those cuts,” Candilis said.
Nashville: ‘Ridiculous prices’
At a Kroger Fuel Center about three miles from downtown Nashville, regular gas was priced at $3.89 per gallon on Thursday morning, April 2, after rising sharply in recent weeks, according to AAA.
“Ridiculous prices,” said Mary Sawyers, 63, a retired Nashville resident who helps care for children in her extended family.
Sawyers drives a family member’s SUV to shuttle three children between school, daycare and other activities. While she does not usually pay for gas herself, she said the cost would be difficult to absorb.
“If I had my own car right now, I think that I would have moved out of town,” she said.
The children’s mother, who relies on the car for work, has not cut back.
“It doesn’t affect her at all mentally,” Sawyers said of the children’s mother, who is more focused on getting to work and having her kids picked up.
Delaware and Maryland: ‘You have to absorb the cost somewhere’
In Middletown, Del., regular gas was priced at $3.89 per gallon at a Royal Farms station on Wednesday, April 1.
Rebecca Johnson, 66, who is semi-retired and works part-time in social services, said the rise in gas prices has been “a significant increase.”
“It’s affecting me, but not to the point where I have to cut back on medications or food,” Johnson said. “I just watch where I go now.”
Rather than taking the freeway and paying tolls, she now takes the back roads. “Instead of convenience, it takes me a minute or two more, but you have to absorb the cost somewhere,” Johnson said.
Some drivers say they are bracing for even higher prices as they absorb the current jump.
“It’s more money, but no matter what, you need gas so you’re going to pay for it,” said Kyle Fletcher, 34, at a Royal Farms in Cecilton, Md., where the price per gallon of regular gas was $3.99 last Wednesday.
“It’s not something I think about very often. I just pull up and put gas in the car, but of course I’d like to see [the price] come down.”
So far, he said, he hasn’t had to adjust his budget. “But if what they’re predicting for [gas prices] is right, I’m sure that’ll be coming soon,” said Fletcher, who works in construction.
About 10 miles away, at Molly’s Mart in Kennedyville, Md., the price for a gallon of regular gas was $4.19 per gallon.
Mark Garver, 62, said the higher cost “affects all the middle class, in a negative way.”
“They already eat us up on groceries, and now they eat us up on oil,” said Garver, who is an independent Medicare broker.
He said he has responded to the higher prices by driving less. “It’s making sure you take one trip instead of three trips,” he said.
Los Angeles: ‘It’s pretty crazy’ at nearly $7 a gallon
On Monday, at a Shell station in downtown Los Angeles, regular gas was priced at $6.99 per gallon with cash and $7.19 with credit or debit.
Emanuel Gonzalez, 28, a contractor who recently moved from Virginia and works on flooring, painting and drywall projects, said the price difference has been jarring.
“I’m used to $4.20, $4.30 [in Virginia]. So moving to the West Coast and dealing with $6.99, $7.09, I think it’s pretty crazy,” he said.
Gonzalez said his manager has asked workers to avoid filling up in high-cost areas like downtown Los Angeles or Koreatown. But with his tank nearly empty, he said he had little choice.
“I was told to go somewhere else, but when I’m stuck with no gas, I have no choice but to hit the local Shell in downtown LA,” he said. Even so, he added, he only put $10 worth of gas in his tank to make it to a cheaper station.
Rising fuel costs are also changing how jobs are scheduled. Gonzalez said his manager is pushing crews to complete work in a single visit to avoid return trips.
“My manager, he’s telling me, do not waste a lot of time as far as going to properties and having to come back or not finishing the work all the way through to come back, because gas is expensive, man. At that point, we’re just losing profit margins,” he said.
At a USA Gasoline station in the Lincoln Heights neighborhood, regular gas was priced at $5.79 per gallon.
Martín Diaz, 17, who recently graduated from high school and lives in the area, said higher prices have changed how he drives and spends.
“I used to go out and waste money a lot. Now I have to think about, ‘OK, do I really need this?'” he said. He said he is changing how he drives to further stretch each tank of gas.
“It just sucks,” he said. “I’m wondering, when is it gonna go down? I feel like everybody is.”
The Federal Reserve held interest rates steady at the conclusion of its policy meeting on Wednesday.
In what could be Jerome Powell’s last as chair before President Donald Trump’s yet-to-be-confirmed nominee Kevin Warsh takes the helm, central bankers maintained the federal funds rate in a target range of 3.5% to 3.75%.
Inflation has surged since the war with Iran began, leaving policymakers with limited room to act, according to Sean Snaith, the director of the University of Central Florida’s Institute for Economic Forecasting. “We’re in a kind of suspended animation — between Iran and the Fed transition,” Snaith said.
Before the oil shock, inflation was holding above the Fed’s 2% target but not worsening. Now the jump in energy costs could have longer-term inflationary effects, economists say.
For Americans struggling in the face of higher gas prices and overall affordability challenges, the central bank’s decision to keep interest rates unchanged does little to ease budgetary pressures. “The cavalry isn’t coming anytime soon,” Snaith said.
How the Fed decision impacts you
The Fed’s benchmark sets what banks charge each other for overnight lending, but also has a trickle-down effect on many consumer borrowing and savings rates.
Short-term rates are more closely pegged to the prime rate, which is typically 3 percentage points above the federal funds rate. Longer-term rates, such as home loans, are more influenced by inflation and other economic factors.
Credit cards
Most credit cards have a short-term rate, so they track the Fed’s benchmark.
After the Fed cut rates three times in the second half of 2025, the average annual percentage rate has stayed just under 20%, according to Bankrate.
“Without Fed rate cuts, there’s not much reason to expect meaningful declines anytime soon, so carrying a balance will remain very expensive,” said Matt Schulz, chief credit analyst at LendingTree.
Mortgage rates
Fixed mortgage rates, on the other hand, don’t directly track the Fed but typically follow the lead of long-term Treasury rates.
Concerns about how the Iran war will impact the U.S. economy have already pushed the average rate for a 30-year, fixed-rate mortgage up to 6.38% as of Tuesday, from 5.99% at the end of February, according to Mortgage News Daily.
That leaves homeowners with existing low mortgage rates “feeling stuck,” said Michele Raneri, vice president and head of U.S. research and consulting at TransUnion. “Mortgages, more than any other credit type, work on a churn,” she said, referring to how a dip in rates can boost borrowing activity.
Student loans
Federal student loan rates are also fixed and based in part on the 10-year Treasury note, so most borrowers are somewhat shielded from Fed moves and recent economic uncertainty.
Current interest rates on undergraduate federal student loans made through June 30 are 6.39%, according to the U.S. Department of Education. Interest rates for the upcoming school year will be based in part on the May auction of the 10-year note.
Car loans
Auto loan rates are tied to several factors, including the Fed’s benchmark. Because financing costs remain elevated, new car buyers are taking on longer loans to keep their monthly payments manageable, according to the latest data from Edmunds.
Even so, with the rate on a five-year new car loan near 7%, the average monthly payment on a new car rose to $773 in the first quarter of 2026, an all-time high.
“Car buyers are in a tough spot right now because they’re getting squeezed from both ends: high sticker prices and high interest rates, with neither showing any signs of letting up,” said Joseph Yoon, consumer insights analyst at Edmunds.
“Until the rate picture shifts, buyers will keep stretching loan terms to make payments work, which only adds to the total cost of ownership down the road,” Yoon said.
Savings rates
While the Fed has no direct influence on deposit rates, the yields tend to be correlated with changes in the target federal funds rate. So, although rates on certificates of deposit and high-yield savings accounts have fallen from recent highs, they are holding above the annual rate of inflation.
For now, top-yielding online savings accounts and one-year CD rates pay around 4%, according to Bankrate.
“Yields on high-yield savings accounts and certificates of deposit are down from their peaks of a few years ago, but they’re still strong compared to what we’ve seen for most of the past decade,” Schulz said.
Milan Markovic | E+ | Getty Images
The average tax refund is 11.2% higher this season, compared with about the same period in 2025, according to the latest IRS filing data.
As of April 10, the average refund amount for individual filers was $3,397, up from $3,055 about one year ago, the IRS reported on Friday.
The IRS data reflects about 114 million individual returns received, out of about 164 million expected through Tax Day. Next week’s filing update is expected to include data through the April 15 deadline.
President Donald Trump‘s 2025 legislation, rebranded to the “working families tax cuts,” was a key talking point for Republicans on Tax Day.
With the November midterm elections approaching and Republicans defending slim majorities in Congress, many GOP lawmakers have highlighted Trump’s tax breaks and higher average refunds.
Meanwhile, affordability has been top of mind for many Americans amid rising costs of gas, electricity, food and other living expenses.
For filers who expected a refund this season, nearly one-quarter, or 23%, planned to use the funds to pay down credit card debt, and the same share said they would save the payment, according to the CNBC and SurveyMonkey Quarterly Money Survey, released in April. It polled 3,494 U.S. adults at the end of March.
Who benefited from Trump’s ‘big beautiful bill’
“It’s been a great tax season for the American people,” many of whom have benefited from Trump’s tax breaks, Treasury Secretary Scott Bessent said during a White House press briefing on Wednesday.
More than 53 million filers claimed at least one of Trump’s “signature new tax cuts” — the deductions for tip income, overtime earnings, seniors and auto loan interest — the Department of the Treasury also announced on Wednesday.
Those filers, who claimed the deductions on Schedule 1-A, have seen an average tax cut of over $800, according to the Treasury. Tax cuts can trigger a higher refund or reduce taxes owed, depending on the filer’s situation.
Some filers who itemize tax breaks have also seen benefits from the bigger federal deduction limit for state and local taxes, known as SALT. Trump’s legislation raised that cap to $40,000, up from $10,000, for 2025.
The latest SALT deduction limit change is expected to primarily benefit higher earners, according to a May 2025 analysis of various proposals from the Tax Foundation.
The Treasury has not released data on how many filers have claimed the SALT deduction during the 2026 filing season.
Traders work at the New York Stock Exchange on April 16, 2026.
NYSE
U.S. stocks climbed to record highs on Thursday against a backdrop of war, an oil supply shock and economic forecasts warning of stunted growth amid a protracted conflict.
Many investors may be thinking: Why?
Largely, it’s because the stock market is a barometer of what investors think will happen in the future, rather than an assessment of the present day, according to economists and market analysts.
Investors are essentially shrugging off the Middle East conflict as a blip that will be resolved relatively quickly, they said.
“The stock market isn’t trying to price what’s happening today,” said Joe Seydl, a senior markets economist at J.P. Morgan Private Bank. “The stock market is always trying to price what the world is going to look like six to 12 months from now.”
Why stocks have been ‘resilient’
The S&P 500, a U.S. stock index, fell about 8% in the initial weeks of the Iran war, from the start of the conflict on Feb. 28 to a recent low on March 30.
But stocks have rebounded since then, erasing all losses since the beginning of the war. The S&P 500 closed at an all-time high on Thursday — about 11% higher than its nadir at the end of March. That followed a record close on Wednesday.
“The market has remained very resilient in the face of the war and has rallied strongly on the prospect that it will be resolved,” said Mark Zandi, chief economist at Moody’s.
A ship waits to pass through the Strait of Hormuz following the two-week temporary ceasefire between the US and Iran, which is conditional on the opening of the strait, in Oman on April 8, 2026.
Shady Alassar | Anadolu | Getty Images
And while investors cheered the possibility of a diplomatic off-ramp to the conflict, the temporary ceasefire has appeared tenuous, with the U.S. and Iran each accusing the other of breaking the agreement.
Nations haven’t been able to reach a peace deal ahead of the ceasefire’s end. Vice President JD Vance said U.S. officials left peace talks in Pakistan over the weekend after the Iranian delegation refused to agree to American demands not to develop a nuclear weapon.
The markets ‘have memory’
Ultimately, the stock market is signaling a collective belief that tensions will ratchet down, the war will end in the near term and oil flows through the Strait of Hormuz will normalize, economists said.
That’s largely because investors have been conditioned to believe that President Donald Trump will back off if the economic pain becomes too intense, economists said — the so-called “TACO” trade, shorthand for “Trump always chickens out.”
“Investors strongly believe — and have been conditioned to believe — he’s going to stand down, find a way to pivot, declare victory and move on,” Zandi said.
Trump has pushed back on the notion of backing down, framing his brinkmanship as a savvy negotiating tactic.
Economists pointed to a recent example of this dynamic: in April 2025 during so-called liberation day, when the Trump administration levied a host of tariffs on U.S. trading partners.
Within days — after the stock market had cratered more than 12% — Trump announced a 90-day pause on those tariffs. Stocks then saw one of their biggest daily rallies in history following Trump’s reversal.
Investors remember that Trump often de-escalates geopolitical shocks — which is why they’ve seized on positive headlines that hint at progress in peace talks, for example, Seydl said.
“The markets have memory,” Seydl said.
AI stocks and the ‘tech boom’
Traders celebrating at the New York Stock Exchange on April 15, 2026, as the S&P 500 closed above the 7,000 level for the first time.
NYSE
There are other factors underpinning market resilience during wartime, economists said.
One is the investors’ enthusiasm for artificial intelligence and technology stocks, which account for almost half of the S&P 500’s market capitalization, Zandi said.
“Those stocks run on their own dynamic independent of anything, including the war in Iran,” Zandi said. “I think we would have been down a lot more and it would have been harder for us to recover had it not been for the very, very optimistic perspectives on AI.”
We’re in the middle of a “tech boom” — and investors are likely to remain optimistic until they think the tech cycle has run its course, Seydl said.
More broadly, stock investors are essentially making a bet on the future earnings growth of a company — and the earnings backdrop has been “pretty solid,” Seydl said.
Consumer spending appears to be stable, for example, economists said. And companies are getting a boost to their after-tax earnings from the GOP’s so-called “big beautiful bill,” which, among other things, made it easier to write off investments upfront and therefore reduce their tax liability, Zandi said.
Going forward
Experts said there will be an economic hit from the Iran war, though.
“Despite the recent news of a temporary ceasefire, some damage is already done, and the downside risks remain elevated,” Pierre-Olivier Gourinchas, director of research at the International Monetary Fund, wrote Tuesday.
A protracted conflict risks deep and global economic pain, he wrote.
Even if the conflict is short-lived — as the broad market expects — stocks are unlikely to march much higher until it’s clear the U.S. is on the other side of the war and its economic fallout, Zandi said.
If investors are incorrect, and President Trump doesn’t back down or quickly extricate the U.S. from the war, the stock market may see a “full-blown correction” or worse, Zandi said. A stock market correction is a decline of at least 10% from recent highs.
“Everyone thinks they know what the script is,” Zandi said. “Now they just need to follow the script. If they don’t, the market will have some real problems.”
The uncertainty provides yet another example of why the average investor with a long time horizon should stick to their investment plan and ignore the noise, experts said.
“Trying to time the market is very difficult if not impossible for the average investor,” Seydl said. “It’s better to take a long-term perspective and ride out bouts of volatility.”
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