Ongoing reports suggest a peace deal between the U.S. and Iran “soon” over the Strait of Hormuz. In response, diesel, gas, and crude oil prices are down.

There were rumors of a deal last week, but discussions have dragged on between the two countries. The situation is hopeful enough for fuel prices to have dropped, but there are still several obstacles in the way before true resolution can be reached.

First, the leaders of both Iran and the U.S. are demanding compensation from the other for war damages. This is just one of the many conditions currently being negotiated. It’s unclear at this point how likely it is for either country to receive compensation, but considering how the situation has developed so far, this will be a contentious issue on both sides.

Then there’s the matter of continued violence. Already this week (as of August 11), there have been at least two attacks or strikes in the Strait, including one attack on a container ship that may have been conducted by the U.S. It’s extremely unlikely that these attacks will aid the peace negotiations.

And there’s the noncommittal nature of both countries’ leaders. On August 8, Iranian Foreign Minister Abbas Araghchi said the country is in final negotiations with Oman over the Strait but claimed that this will not lead to a reopening. It will not occur until the U.S. meets its demands. At the same time, Iran continues to emphasize that it is not in negotiations with the U.S., but the U.S. claims otherwise.

For his part, President Trump told Axios on August 9 that he is but also isn’t negotiating with Iran.

"We are only semi-negotiating with them,” President Trump said. “We are just watching Iran with its huge inflation and the fact they have no money."

The uncertainty across the board involving both of these countries and the Strait of Hormuz can only mean continued ups and downs regarding fuel prices.

The national average on-highway diesel price dropped 9 cents to $5.257, according to data released by the U.S. Energy Information Administration (EIA) on August 11. Gas prices dropped 7 cents to $4.006. Compared to last year, diesel prices are up $1.503, and gas prices are up 89 cents.

What are the current diesel prices across the U.S.?

Here are this week’s diesel price highlights from each region of the U.S.:

• East Coast: The biggest decrease in diesel prices this week occurred off the East Coast for 11 cents to $5.193.
• West Coast: Off the West Coast, diesel prices dropped 10 cents to $6.033. Without including California, diesel prices dropped 10 cents to $5.526. 
• Gulf Coast: Off the Gulf Coast, diesel prices dropped 10 cents to $5.044.
• Midwest: In the Midwest, diesel prices dropped 8 cents to $5.181.
• Rocky Mountain: In the Rockies, diesel prices dropped 1 cent to $5.271.

According to AAA Motor Club (AAA), the current national diesel price average is $5.321. This is 6 cents higher than EIA’s current estimate and $1.611 higher than this time last year.

What are the current gasoline prices across the U.S.?

The current national average on-highway gasoline price is $4.006, according to EIA, 7 cents lower than last week’s average. 

Here are this week’s gasoline price highlights from each region of the U.S.:

• Midwest: The biggest drop in gasoline prices this week occurred in the Midwest for 11 cents to $3.816.
• Gulf Coast: Off the Gulf Coast, gas prices dropped 6 cents to $3.543.
• East Coast: Off the East Coast, gas prices dropped 6 cents to $3.884.
• West Coast: Off the West Coast, gas prices dropped 6 cents to $5.075. Without including California, gas prices dropped 4 cents to $4.643. 
• Rocky Mountain: In the Rockies, gas prices dropped 2 cents to $4.121.

According to AAA, the current national gasoline price average is $4.012. This is 0.6 cents higher than EIA’s current estimate and 87 cents higher than this time last year. 

A recent press release by AAA stated, “Crude oil prices are down in the $70 per barrel range amid optimism that the Strait of Hormuz will resume normal operations. Currently, half of states are paying below $4 per gallon on average. Gas prices typically start going down this time of year, as many schools and universities begin fall semesters, and fewer people are taking road trips compared to earlier in the summer.”