Anabelle Colaco
20 Mar 2026

GUILDFORD, U.K./RICHMOND, Virginia: A surge in gasoline prices linked to the Iran war is beginning to ripple through the auto market, raising concerns for carmakers while prompting some consumers to consider electric and hybrid vehicles.

The conflict has disrupted shipping through the Strait of Hormuz, a key route for roughly 20 percent of global oil supplies, pushing fuel prices higher and adding pressure on motorists.

For Martin Miller, who runs a used electric-vehicle dealership near London, the shift has already translated into stronger demand. He recorded his busiest Saturday ever, a week after the war began on February 28.

"We're turning cars very, very quickly," Miller said, noting that customers at his store, EV Experts, are increasingly worried about rising petrol prices. His team has been buying more electric vehicles at auctions "like mad," he added, "because we're confident this will continue."

Fuel prices have risen sharply across regions. In Britain, average gasoline prices per liter were up seven percent as of March 16, while prices in the European Union rose eight percent, according to official data. In the United States, gasoline prices have climbed 27 percent since late February to US$3.72 per gallon, the U.S. Energy Information Administration said.

Past oil shocks have reshaped consumer behaviour, but analysts say a sustained period of high prices is typically needed before buyers shift decisively toward more fuel-efficient vehicles.

"Consumers are highly reactive to gas prices, but it tends to be that it has to hit a certain round number," said Kevin Roberts, director of economic and market intelligence at CarGurus. "The $4 (per gallon) threshold may be the one to watch," he said, noting that it marked a tipping point for EV interest during the 2022 oil shock following Russia's invasion of Ukraine.

Some buyers are already acting. Zach Xavier, a U.S. customer, recently traded in a combustion-engine SUV for an electric vehicle and bought a second, smaller EV. "I'm trying to get in before everybody freaks out," he said.

So far, however, broader shifts remain limited. CarGurus said it has not yet seen major changes in EV search activity, while Edmunds reported a modest rise in interest in electrified vehicles to 22.4 percent in the first week after the war began, from 20.7 percent previously.

Europe may see a faster shift. Fully electric vehicles accounted for 19.5 percent of sales there last year, and some governments are reintroducing incentives. In Germany, online dealer MeinAuto reported a 40 percent increase in EV-related traffic since the war began, while a Carwow survey found 48 percent of respondents said higher fuel prices would influence their decision to consider an EV or hybrid.

In contrast, the U.S. market may require a sharper rise in fuel costs. EVs made up 7.7 percent of new-car sales last year, and analysts say prices may need to reach $6 per gallon before driving widespread adoption.

"Unless you really need a car right now," said Cox Automotive's Stephanie Valdez-Streaty, "you might hold off."