The US national average price for regular gasoline reached $4.229 per gallon on Wednesday, the highest level in nearly four years, setting up further upward pressure on demand for EVs already showing signs of a measurable rebound in consumer interest.
The current pump price is up roughly $1.07 per gallon over the last twelve months, a gain of about 33% from the $3.16 average AAA recorded exactly a year ago.
Wednesday’s prices are the highest since the summer of 2022, when they peaked above $5.01 per gallon in June of that year before easing.
Most of the increase has occurred since February 28, 2026, when the war between the United States, Israel, and Iran began disrupting oil flows through the Strait of Hormuz and drove Brent crude above $100 per barrel.
Strait of Hormuz Traffic Plunges
Vessel traffic through the Strait of Hormuz has fallen sharply since the conflict began, restricting the flow of crude that typically passes through the choke point.
Just 35 ships transited the strait during the week of April 20 to 26, down from 78 the week before, according to Lloyd’s List Intelligence data published this week.
US president Donald Trump claimed on Tuesday that Iran had reached out to his administration over the disruption, in a post on his Truth Social platform.
“They want us to ‘Open the Hormuz Strait,’ as soon as possible, as they try to figure out their leadership situation,” Trump wrote.
The four-year pump-price high is sharpening the cost-of-ownership argument for electric vehicles in the United States, where the federal $7,500 EV tax credit’s expiration on September 30, 2025 had cooled new-EV sales through the fourth quarter of last year and the first quarter of 2026.
EV Search Activity Climbs
Consumer search activity for electric vehicles has risen sharply since the Iran conflict began, even as actual sales conversion has lagged.
CarGurus listing views for EVs rose 31% between the start and end of March.
Edmunds and CarMax both reported noticeable increases in EV-related searches and page views over the same period.
Cox Automotive director of industry insights Stephanie Valdez Streaty said interest in new EVs was up 16% through March compared with the fourth quarter of 2025, speaking at an Electrification Coalition online symposium on April 8.
“Gas prices don’t translate to sales immediately, but it definitely translates into consideration,” Valdez Streaty said.
Kelley Blue Book Managing Editor Sean Tucker echoed the framing in a Cox Automotive note published on April 10.
“It’s not uncommon for us to see a spike in EV-related searches when gas prices rise. Searching is free,” Tucker said.
“A spike in actual sales would be unprecedented after just a month of high gas prices, because shopping for a new car is a long process influenced by many factors,” Tucker added.
Used EVs Lead the Response
The used EV market has shown the clearest signs of benefiting from the gas-price spike, with multiple data points pointing to genuine consumer movement rather than just consideration.
Used EV sales reached 93,500 units in the first quarter of 2026, up 12% from 83,587 in the first quarter of 2025 and up 17% from the fourth quarter, according to Cox Automotive.
The average used EV transaction price has fallen to $34,821, within $1,300 of the $33,487 average for an equivalent gas-engine used vehicle — the narrowest price gap on record.
Cox Automotive‘s Manheim Used Vehicle Value Index rose 6.2% year-over-year and 0.5% from March in mid-April 2026, with electric vehicles outpacing the broader used market.
The non-EV index by comparison rose 1.7% year-over-year and 1.6% from March.
“Wholesale prices are still rising but at much more normal levels relative to long term averages,” Cox Automotive’s Manheim analysts wrote in the mid-April update.
“Meanwhile, gas prices remain above $4 per gallon and used EV values show higher appreciation than non-EV values,” the analysts added. “It’s going to be an interesting year observing the valuations and sales pace of used EVs as the market sniffs out consumer demand elasticity with the fluctuations in gas prices.”
Used EV days’ supply currently sits at 42 days, just four days higher than the 38 days for combustion vehicles — a sign of genuine consumer demand rather than excess inventory, Cox Automotive said.
Recovering from Tax Credit Expiration
The recovery in EV interest has been less visible in new-vehicle sales, where the federal tax credit’s September 30, 2025 expiration continues to weigh on demand.
New EV sales fell 27% year-over-year in the first quarter to 216,399 units, with electric vehicles holding 5.8% of total new-vehicle sales — well below the 10.6% peak reached in the third quarter of 2025, when buyers rushed to capture the $7,500 federal incentive before it expired.
The Q1 decline was an improvement from the 36% year-over-year drop in the fourth quarter of 2025, suggesting the post-tax-credit reset has begun to stabilize.
“With federal incentives gone, the first quarter reflected a necessary reset — sales slowed and market share shifted,” Valdez Streaty said on April 10.
“What comes next will be driven less by policy and more by fundamentals: more affordable products, smarter pricing strategies, and continued investment in infrastructure,” she added. “Those longer-term fundamentals continue to support EV growth. The timeline has shifted, but the direction hasn’t.”
The average transaction price for a new EV in March was $54,508, compared with about $50,000 for a new gas-powered vehicle, according to Cox Automotive — the smallest gap on record.
Cadillac, Lexus, and Toyota were among the few brands to deliver year-over-year EV sales growth in the first quarter, Cox Automotive said.
Sales Holding Up Despite Headwinds
The firm forecast on April 24 that the seasonally adjusted annual rate of US new-vehicle sales in April would finish near 16.1 million units, down only slightly from March’s 16.3 million level, despite the higher fuel costs and weak consumer sentiment.
April sales volume is expected to fall 1.9% from March and 5.4% from April 2025, the company said.
The April pace remains well below the 17.1 million SAAR recorded in April 2025, when Tesla and other automakers had pulled forward sales ahead of tariff implementation.
Lease Return Wave Ahead
Cox Automotive expects the used EV market to continue benefiting from a wave of lease returns over the next two years.
The company projects 300,000 EVs will come off lease in 2026, rising to 600,000 in 2027 and as many as 660,000 in 2028, Valdez Streaty said.
The lease returns have been driven in part by the Inflation Reduction Act’s so-called “leasing loophole,” which allowed dealers to claim the $7,500 commercial EV tax credit on leased vehicles between 2023 and 2025, even when the leased vehicle would not have qualified for the consumer credit.
That dynamic produced a wave of EV leases that are now beginning to mature and return to dealer lots, Cox Automotive’s deputy chief economist Mark Strand said.
Edmunds Cautions Against Overinterpretation
Not all analysts agree that gas prices alone will translate into sustained EV adoption.
Edmunds insights chief Jessica Caldwell drew a comparison to the 2022 Russian invasion of Ukraine, when fuel prices triggered a similar surge in EV consideration that produced only modest sales gains.
“EV market share climbed from 4.4% to 5.2% between March and June of that year before leveling off, influenced by factors other than gas prices,” Caldwell wrote in an Edmunds analysis published earlier this month.
“Frustration at the pump alone won’t sell electric vehicles — adoption depends on whether consumers are ready, not just resentful,” she added.
Caldwell noted that affordability remains the primary obstacle to EV adoption, with the average new EV transaction price in March at $56,170, compared with $45,092 for the rest of the industry.
