The ongoing geopolitical conflict with Iran has led to a sharp rise in energy prices in the United States, further increasing the burden on residents. Data from authoritative institutions shows that since the outbreak of the conflict, energy expenditures for American households have increased significantly, completely offsetting annual tax refunds.

Under multiple pressures including stagnant income growth, a savings rate that has fallen to a historic low, and high credit card debt, the purchasing power of American residents continues to weaken. Coupled with sluggish consumption among low-income groups, the overall pace of the US economic recovery has encountered significant obstacles, and the risk of further economic downturn continues to rise.

Geopolitical conflicts drive up energy costs, leading to a significant increase in household spending in the United States.

According to a special calculation released by Moody's Analytics, since the outbreak of the conflict with Iran on February 28, the average U.S. household has increased fuel-related spending by $447.19, and the total increase in energy-related spending by consumers across the United States is close to $60 billion.

As the conflict has lasted for three months, the economic pressure from rising energy prices has become fully apparent. High oil and aviation fuel prices are squeezing residents' disposable income in all aspects of life, including food, clothing, housing, and transportation.

Moody's chief economist Mark Zandi stated that if the geopolitical conflict does not end quickly, financially strained U.S. consumers will be forced to tighten their spending, further dragging down the already weak U.S. economy. He added that if energy prices remain at current high levels, by the time the conflict has lasted a full year, the average U.S. household could incur nearly $2,000 in additional energy expenditures, further exacerbating the financial burden on residents.

Energy prices have risen across all categories, leading to a comprehensive increase in consumer costs across multiple sectors.

Gasoline price increases accounted for more than half of the additional energy expenditures for residents in this round. Data from the American Automobile Association (AAA) shows that since March, the price of unleaded gasoline in the United States has risen by more than 47%, with the latest average price reaching $4.39 per gallon. At the same time, diesel prices, widely used in freight and shipping, have also surged by 47%, reaching $5.52 per gallon, adding more than $20 billion in additional costs for consumers. Rising jet fuel prices have also directly pushed up travel costs, resulting in nearly $10 billion in additional consumer spending. Official data shows that in April this year, the year-on-year increase in US airfares exceeded 20%.

It is noteworthy that the increased spending due to rising energy prices has completely offset the tax rebate that American residents were entitled to this year. The Trump administration's tax reform policy previously provided each household with a $384 tax rebate, but current energy expenditures far exceed this figure, effectively erasing the actual increase in income for residents.

Signs of weakening consumption are emerging, with low-income groups bearing the brunt of the pressure.

Goldman Sachs analysts believe that high energy prices will continue to erode the purchasing power of American residents for the remainder of 2026. Low-income families, whose income is heavily reliant on food and energy expenditures, will be the most directly and severely impacted.

Market data also confirms the trend of weak consumption. Costco's latest financial report shows that sales of low-priced gasoline have hit a record high, reflecting the public's mentality of trying to cut energy spending.

McDonald's CEO Chris Kempczinski stated that the purchasing power of low-income groups in the United States continues to weaken due to rising energy costs, resulting in a cooling trend in the overall consumer market.

High levels of savings overdrafts and debt have led to a continued deterioration in residents' financial structure.

Official U.S. economic data shows that personal consumption expenditures rose 0.5% month-over-month in April, but this growth was not driven by increased income. U.S. household income growth stagnated that month, significantly missing market expectations of a 0.4% increase. Meanwhile, the personal savings rate fell to 2.6% in April, a record low since the financial crisis, a sharp drop from the peak of over 31% in 2020, indicating that residents are continuing to deplete their savings accumulated during the pandemic to maintain daily consumption.

Data from the Federal Reserve Bank of New York shows that U.S. credit card debt reached $1.25 trillion in the first quarter of this year, up nearly 6% year-on-year, approaching the historical peak expected at the end of 2025. Gregory Daco, chief economist at Ernst & Young Parthenon, stated that weak income growth among U.S. residents forces them to rely on depleting savings and overdrafting to maintain their existing consumption patterns, leading to a continued decline in overall financial health.

Summarize

Overall, the energy price surge triggered by the geopolitical conflict in Iran has evolved from a simple price fluctuation into a systemic financial burden on residents.

The exhaustion of tax rebate benefits, a sharp drop in the savings rate, high debt, and contraction in consumption are compounding multiple problems, not only suppressing the living standards of American residents but also continuously dragging down the macroeconomic performance. The pace and stability of the subsequent recovery of the US economy will face continuous tests.