Brent crude touched $110 on Wednesday morning, up 5% on the day. By noon it had settled closer to $108. The headline moved on. Your expenses won’t.

The national average for a gallon of regular gasoline hit $3.84, according to AAA — a sharp climb since the war began. Jet fuel tells a worse story: $3.93 a gallon, up from $2.50 the day before the first strikes. That’s a 57% increase in under three weeks.

Airlines are doing the math in public. Skift estimates U.S. carriers face $24 billion in additional fuel costs this year. Fares need to rise at least 11% just to break even, according to industry analysts. SAS has already cancelled 1,000 April flights. Cathay Pacific doubled its fuel surcharges effective today.

Then there’s the Fed, which wrapped its March meeting hours after oil hit $110. The decision: hold rates steady. The subtext: panic. Policymakers raised their 2026 inflation projection to 2.7%, up from December’s 2.5% forecast, citing a “substantial rise in oil prices” caused by Middle East supply disruptions. Near-term inflation expectations have climbed, and the path to rate cuts looks increasingly blocked.

The trigger was the latest exchange of strikes on Gulf energy infrastructure, including extensive damage to Qatar’s Ras Laffan complex, home to the world’s largest LNG export facility. But the macroeconomic damage was already baking in before today’s spike.

Every $10 increase in crude adds roughly 25 cents to a gallon of gas within two to four weeks. At $110, the math points to $4-plus gasoline by April — territory that historically starts changing consumer behavior and dragging on GDP.

The Fed can’t cut into an oil shock. It can’t hike into a slowing economy. So it holds, and waits, and hopes the barrel comes back down before the damage becomes structural.

Hope is not a monetary policy.

Sources