Can Conflicts in Other Countries Affect Energy Prices in the U.S.?

Key Points of This Article:

• Global conflicts can raise U.S. energy prices because oil and natural gas are traded on interconnected international markets, meaning disruptions or risks abroad can quickly impact prices Americans pay at home.
• Oil, natural gas, and electricity respond differently to global conflicts, with oil prices usually reacting fastest, natural gas increasingly affected through LNG exports, and electricity prices rising more gradually as fuel costs increase.
• Although the U.S. produces large amounts of energy domestically, it is not protected from global price swings.

Can Conflicts in Other Countries Affect Energy Prices in the US? 

Conflicts in other countries can most definitely affect energy prices in the U.S. 

Energy prices in the United States are influenced by global markets because oil and natural gas are traded internationally, energy supply routes are interconnected, energy traders often respond to geopolitical risks immediately, and global shortages in natural gas can affect international demand for U.S. exports. 

Even though the U.S. produces large amounts of energy domestically and is known as the largest exporter of liquefied natural gas, it still participates in global markets. When conflicts threaten major energy-producing regions or shipping routes, global prices often increase, which can eventually raise prices for American consumers. 

Recent tensions in the Middle East in 2026 have been causing fears that key oil and liquefied natural gas shipping routes could be disrupted. Even before any major supply loss occurred, global oil and gas prices have risen already for the 11th day in a row as of March 11th 2026, according to The New York Times, due to market uncertainty. 

Why Energy Prices Are Global (Even for U.S. Energy) 

Even though the United States produces a large amount of oil and natural gas, prices are still influenced by international markets. 

Three major factors connect U.S. prices to global events: 

Global commodity pricing 

Energy resources like crude oil and liquefied natural gas are traded globally. Prices are determined by supply and demand across international markets. 

International exports 

The United States exports crude oil, refined petroleum products, and liquefied natural gas. This means domestic supply is partly tied to global demand. 

Shared infrastructure 

Energy moves through shipping routes, pipelines, and international ports. When these systems are disrupted, ripple effects spread quickly through global markets 

How Geopolitical Conflicts Disrupt Energy Supply 

Geopolitical conflicts can disrupt energy markets through several interconnected mechanisms. Because oil and natural gas move through a complex global supply chain that includes production sites, pipelines, shipping routes, refineries, and financial markets, disruptions in one part of the system can quickly ripple across the entire energy economy. 

Below are some of the main ways geopolitical conflicts influence global energy supply and pricing: 

Production disruptions 

Conflicts that occur near major oil or natural gas producing regions can directly interrupt energy production. This may happen when: 

• Energy infrastructure such as pipelines, wells, or refineries can be damaged 

• Energy companies evacuate workers due to safety risks 

• Governments shut down production to prevent facilities from being targeted 

• Political instability prevents normal operations 

When production slows or stops in a major exporting country, the global supply of energy can tighten quickly. Even a relatively small disruption can move markets because oil and natural gas production typically operates near full capacity worldwide. 

For example, if a large oil-producing region suddenly exports fewer barrels per day, global buyers may begin competing for a smaller pool of supply, which pushes prices upward. 

Sanctions and trade restrictions 

Governments often respond to geopolitical conflicts by imposing economic sanctions. These sanctions can restrict a country's ability to export energy resources such as crude oil or natural gas. 

Sanctions may include: 

• Limits on energy exports 

• Restrictions on financial transactions with energy companies 

• Shipping insurance bans 

• Restrictions on companies purchasing fuel from sanctioned nations 

When sanctions remove large volumes of energy from global markets, other countries must compete for replacement supply. This can lead to rapid price increases across international markets, which may eventually affect U.S. fuel and electricity prices. 

Shipping disruptions 

Energy resources frequently travel long distances before reaching consumers. Much of the world's oil and liquefied natural gas moves through narrow waterways. For example, the Strait of Hormuz, stretching just over 21 miles long, controls approximately 21% of global petroleum liquids transit. If a conflict threatens these routes, like the political conflict between Iran and the United States in Spring 2026, temporarily disrupting oil shipping in the Strait of Hormuz, shipping companies may suspend tanker operations or reroute vessels to avoid danger. 

When shipping becomes slower, more expensive, or temporarily halted, global supply chains tighten. Even the possibility that a key route could be blocked can cause energy traders to push prices higher. 

Market uncertainty 

One of the most powerful forces affecting energy prices during geopolitical conflicts is uncertainty. Energy markets respond quickly to news because traders constantly try to predict future supply conditions. 

If a conflict increases the likelihood of production shutdowns, shipping disruptions, or sanctions, traders may begin purchasing energy contracts in anticipation of tighter supply. This activity can cause prices to rise long before any physical shortage occurs. 

In other words, markets often react to the risk of disruption rather than waiting for an actual supply loss. This is why energy prices sometimes spike rapidly during international crises, even if energy infrastructure has not yet been damaged. 

How Conflicts Affect Different Types of Energy 

Not all energy sources react the same way to geopolitical conflicts. While oil, natural gas, and electricity are closely connected, each market has its own supply chain, infrastructure, and pricing system. This means global conflicts can affect each type of energy differently and sometimes at different speeds. 

Oil and gasoline 

Oil prices usually react first to geopolitical conflicts because crude oil is one of the most globally traded commodities in the world. Millions of barrels of oil are bought and sold every day through international markets, and prices respond quickly to any event that could threaten supply. 

When conflicts occur in or near major oil‑producing regions, markets immediately assess whether production or transportation could be affected. Even the possibility of disruptions can push prices higher. 

Oil price changes can reach consumers fairly quickly because crude oil is refined into products such as: 

• gasoline 

• diesel 

• jet fuel 

• heating oil 

If crude oil becomes more expensive, refineries must pay more for their raw supply, and those higher costs often move through the supply chain to fuel prices at gas stations. 

For example, in 2023, attacks by Houthi rebels on commercial vessels in the Red Sea forced major shipping companies to reroute, which increased shipping time by 10-14 days, added extra full costs, and increased oil prices. 

Natural gas 

Natural gas markets respond differently than oil markets because natural gas historically relied more heavily on regional pipelines rather than global shipping. However, that dynamic has changed significantly in recent years due to the growth of liquefied natural gas (LNG). 

LNG allows natural gas to be cooled, shipped across oceans in specialized tankers, and delivered to markets worldwide. As LNG trade expands, natural gas prices in different regions have become more interconnected. 

Geopolitical conflicts can affect natural gas markets in several ways: 

• disruptions to LNG export facilities 

• restrictions on pipeline flows between countries 

• increased demand from regions experiencing shortages 

• shipping route disruptions affecting LNG tankers 

When global demand for LNG rises due to shortages in other regions, international buyers may compete for available shipments. This can increase natural gas prices in exporting countries, including the United States. 

Higher natural gas prices can affect American households in several ways. Natural gas is commonly used for: 

• home heating 

• cooking 

• water heating 

• electricity generation 

Because many power plants rely on natural gas as a fuel source to generate electricity, rising gas prices can also influence electricity costs. 

Electricity 

Electricity markets are affected indirectly by geopolitical conflicts because electricity itself is not typically traded globally the same way oil or LNG is. Instead, electricity prices are influenced by the cost of fuels used to generate power. 

In many regions of the United States, electricity is generated using a mix of energy sources that may include: 

• natural gas 

• coal 

• nuclear energy 

• geothermal power 

• wind and solar power 

When fuel prices rise, especially natural gas, the cost of generating electricity can increase. Power plants must pay more for the fuel they use to produce electricity, and those higher costs can eventually influence utility rates. 

However, electricity prices may not rise as quickly as gasoline prices because utilities often purchase fuel months in advance or use long‑term contracts to stabilize costs. As a result, changes in global energy markets may take longer to appear in electricity bills compared to gasoline prices. 

Over time, though, sustained increases in fuel costs can place upward pressure on electricity prices for households and businesses. 

Does U.S. Energy Production Protect Us From Global Price Spikes? 

Even with high levels of production, the U.S. is still deeply connected to global energy markets. 

Several factors explain why global conflicts can still influence prices Americans pay for gasoline, electricity, and natural gas. 

• Oil prices are largely determined by international benchmark markets. Crude oil is bought and sold globally using pricing benchmarks. Even if oil is produced in the United States, its value is still influenced by global supply and demand. If a conflict reduces supply anywhere in the world, the global price benchmark may rise, which can push up prices domestically. 

• The United States both imports and exports energy. While the U.S. exports significant amounts of crude oil, petroleum products, and liquefied natural gas (LNG), it still imports certain types of crude oil that American refineries are designed to process. Because these imports are part of global trade flows, disruptions overseas can influence the availability and price of those supplies. 

• Energy infrastructure and investment decisions are tied to global markets. Energy companies, traders, and utilities constantly evaluate international supply conditions when deciding how much fuel to produce, store, or purchase. This means that global risks can influence market expectations and pricing even when U.S. production remains strong. 

In short, high domestic production provides some stability, but it does not completely isolate the United States from global price volatility. Energy markets are interconnected, and events in one part of the world can still affect prices everywhere. 

Who and What in the U.S. Is Most Affected by Geopolitical Energy Shocks 

When geopolitical conflicts disrupt global energy markets, the effects extend far beyond oil companies or fuel traders. Rising energy costs ripple through the entire economy, influencing households, businesses, transportation systems, and even grocery store prices. 

Because energy is used in nearly every part of modern life, changes in global energy markets can affect many different sectors. Here's who could be the most affected: 

• Households and homeowners: Rising energy prices due to geopolitical conflicts can directly affect household budgets. Higher fuel costs may increase gasoline prices for daily commuting and home heating costs during the winter months, with 47% of U.S. residents relying on natural gas to heat their homes as of October 2025. 

Electricity bills can increase when power generation becomes more expensive. 

Families may notice these changes through higher monthly utility bills or increased fuel costs when filling up their vehicles. 

• Regions dependent on natural gas: When global natural gas markets tighten, these regions may experience stronger price effects because many power plants depend on natural gas as their primary fuel source. 

In these areas, rising natural gas prices can influence both home heating costs and electricity rates. 

• Transportation and logistics companies: Companies that rely heavily on fuel, such as trucking fleets, shipping companies, airlines, and delivery services, are often among the first to feel the impact of rising energy prices. Fuel is a major operating cost in transportation industries. 

When diesel or jet fuel prices increase, companies may raise shipping rates or transportation fees, which can influence the cost of goods across the economy. 

• Grocery stores and food supply chains: Energy prices also play a major role in food production and distribution. Modern agriculture depends on fuel for farm equipment, irrigation systems, fertilizer production, and transportation. 

When fuel prices rise, the cost of growing, processing, and shipping food can increase. Grocery stores may eventually pass some of these costs on to consumers through higher food prices. 

• Manufacturers and industrial facilities: Factories and manufacturing plants often require large amounts of electricity, natural gas, or petroleum-based fuels to operate machinery and produce goods. Higher energy costs can increase operating expenses, which may lead to higher product prices. 

• Local economies and small businesses: Small businesses such as restaurants, retail stores, and service providers may also be affected when energy prices rise. Higher electricity costs, transportation costs, and supplier prices can reduce profit margins or increase the cost of services. 

Because energy costs are embedded in so many parts of the economy, geopolitical conflicts can create ripple effects that extend well beyond utility bills or gasoline prices. 

How Long Do Conflict-Driven Energy Price Spikes Last? 

The duration of energy price spikes caused by geopolitical conflicts can vary widely depending on the type of disruption and how markets respond. Some price increases may last only a few weeks, while others can influence energy markets for months or even years. 

Short‑term price spikes often occur when markets react quickly to breaking news or perceived supply risks. In these situations, prices may rise rapidly as traders anticipate potential disruptions. If the conflict does not significantly affect supply, prices may stabilize relatively quickly once uncertainty decreases. 

Longer‑lasting price increases typically occur when conflicts cause sustained disruptions to production, transportation routes, or international trade flows. For example, if sanctions remove large amounts of energy supply from global markets or if infrastructure damage limits production, prices may remain elevated until new supply sources replace the lost production. 

For example, in March 2026, The Energy Information Administration reported that crude oil prices would remain above $95 per barrel over the next two months, before falling below $80 barrel in the third quarter of 2026, meaning price surges due to conflicts between the Middle East and America can last several months. 

Energy markets also tend to adjust over time. Producers may increase output, new trade routes may develop, and countries may release strategic reserves to stabilize supply. These adjustments can gradually ease price pressures. 

For consumers, this means energy price impacts from geopolitical conflicts often unfold in phases. Prices may spike quickly due to market uncertainty, stabilize as more information becomes available, and eventually return closer to normal levels as global supply chains adapt. 

Are Energy Prices Going Up? 

As of April 2026, energy prices are most definitely increasing. 

The EIA expects increases in electricity prices to outpace inflation through 2026. The EIA projects electricity prices to increase by approximately 4% in 2026, with wholesale prices expected to rise by 8.5% that year. 

What This Means for You as an Energy Customer 

Geopolitical conflicts can lead to feelings of fear and uncertainty. While energy suppliers and utilities can't control the price of natural gas and electricity, we can help protect you from uncertainty. 

At Santanna Energy Services, we take pride in providing our customers with plans designed to help bring clarity, predictability, and stability to their energy costs. Our goal is to help homeowners avoid the stress of constantly changing market prices by offering options that prioritize predictable billing and straightforward pricing. If you're worried about volatility in your energy bill, consider: 

Fixed-Rate Electricity and Natural Gas Plans: Our plan provides customers with a rate that does not change for a specified period of time. This type of plan offers customers the stability of knowing what their energy costs will be for the duration of the agreement.   

Unlimited Electricity and Natural Gas Plans: Our Unlimited Energy plan provides a stable supply charge throughout the duration of your contract.* This makes monthly budgeting more predictable since you'll always know what to expect from your supply charge. 

Instead of worrying about how global conflicts or market shifts might affect your next bill, the right plan can help provide peace of mind so you can focus on your home, family, and everyday life. 

What U.S. Consumers Can Do When Energy Prices Rise 

While geopolitical conflicts and global energy markets are outside the control of individual households, there are still practical steps consumers can take to reduce the impact of rising energy prices on their budgets. 

Below are several strategies homeowners and renters can consider when energy prices rise. 

Improve home energy efficiency 

One of the most effective ways to reduce the impact of higher energy prices is to lower overall energy consumption. Improving energy efficiency means using less energy to perform the same tasks, which can help offset rising utility costs. 

Common efficiency upgrades include: 

• sealing air leaks around windows and doors 

• improving insulation in attics and walls 

• upgrading to energy‑efficient appliances 

• using LED lighting instead of traditional bulbs 

• scheduling regular HVAC maintenance 

Even small efficiency improvements can reduce heating and cooling demand, which often represents the largest portion of household energy use. 

Pay attention to thermostat settings 

Heating and cooling systems are typically the biggest drivers of residential energy use. Adjusting thermostat settings by just a few degrees can reduce energy consumption and lower monthly bills. 

For example, lowering the thermostat slightly during winter nights or raising it during summer afternoons can help reduce energy use without significantly affecting comfort. 

Smart thermostats can also help automate temperature adjustments and optimize heating and cooling schedules. 

Understand your energy plan 

Consumers who purchase electricity or natural gas through competitive energy suppliers may have different plan options. Understanding how these plans work can help households prepare for market volatility. 

Reviewing contract terms and understanding how pricing is structured can help consumers make informed decisions when energy markets become volatile. 

Track household energy usage 

Monitoring how much energy your household uses can help identify opportunities to reduce waste.  

Identify patterns such as: 

• high electricity use during peak hours 

• appliances that consume large amounts of energy 

• seasonal spikes in heating or cooling usage 

By identifying where energy is being used most, homeowners can take targeted steps to reduce consumption. 

Shift energy use when possible 

In some areas, electricity pricing may vary depending on the time of day. Using energy‑intensive appliances during off‑peak hours can sometimes help reduce electricity costs. 

Common appliances that can be shifted to off‑peak periods include: 

• dishwashers 

• clothes washers and dryers 

• electric vehicle chargers 

While not every region uses time‑of‑use pricing, consumers who do have access to these plans may benefit from adjusting when certain appliances are used. 

Reduce fuel consumption in transportation 

Transportation fuel costs often rise quickly when global oil prices increase. Simple adjustments to driving habits can help households manage these costs. 

Options may include: 

• combining errands into fewer trips 

• carpooling when possible 

• maintaining proper tire pressure to improve fuel efficiency 

• using public transportation when available 

These small changes can help reduce the financial impact of rising gasoline prices. 

Stay informed about energy market trends 

Finally, staying informed about major energy market developments can help consumers anticipate potential price changes. Global events, seasonal demand patterns, and infrastructure disruptions can all influence energy prices. 

 

Global conflicts can influence U.S. energy prices because energy markets are interconnected worldwide. When international tensions disrupt supply routes, affect major producing regions, or shake market confidence, price volatility can reach U.S. households quickly. Understanding these dynamics helps homeowners prepare for potential price volatility. 

 

* Restrictions apply. Enrollment based upon program eligibility. Customers using more than 125% of normal monthly usage as determined by Santanna may be required to switch plans.