The national average for gasoline is hovering around $4.50 a gallon, and uncertainty over the Strait of Hormuz has created what analysts are calling the biggest disruption in oil markets ever. As prices climb, lawmakers at the state and federal levels are debating what, if anything, can be done to ease the financial burden on Americans.
The consequences are being felt across the economy. Spirit Airlines has shut down, and other carriers are reporting financial challenges. Last month, American Airlines became the latest airline to raise the cost of a first checked bag to $50. Delta announced new restrictions on snacks on some flights this week.
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Chris Sununu, the former governor of New Hampshire and current president of Airlines for America — which represents the country's largest airlines — said the core issue is geopolitical.
"It's all about opening the Strait of Hormuz," Sununu said.
Sununu said the airlines he represents are not seeking government bailouts, even as the industry faces significant losses.
"Right now the airlines I represent aren't looking for bailouts. I know some of the low-cost guys are doing that," Sununu said.
"The industry itself is looking at somewhere between 8 to 10 billion dollars in losses," Sununu said.
Sununu said changes in snack and baggage policy reflect where the industry stands right now, and that he does not believe the situation has reached a point where major tax policy changes are needed to keep customers flying. Numerous budget airlines, however, have asked Congress for help.
"Other airlines could be in financial risk, there is no question about it," Sununu said.
For Americans focused on the cost of driving, the frustration is palpable.
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"It is insane, it's getting so unbelievably expensive," one driver said.
Congress is planning a vote this month that would allow fuel with a higher percentage of ethanol — known as E15 — to be sold in the U.S. year-round. Currently, the typically cheaper fuel requires a waiver to be sold outside of summer months.
Meanwhile, proposals have emerged in recent days in state capitols to pass gas tax holidays, and there is a proposal at the federal level to do the same. The federal gas tax is 18 cents a gallon.
Sununu acknowledged the limited scope of such measures.
"Those are pretty small, pretty incremental," Sununu said.
Andrew Lautz, with the Bipartisan Policy Center, said gas tax holidays often do not deliver the relief drivers expect.
"Federal gas tax suspensions or state gas tax suspensions don't get fully passed through to drivers at the pump. Some of that benefit is captured by gas stations or oil refineries rather than the actual driver," Lautz said.
While a gas tax holiday may offer some relief for drivers with long commutes, experts suggest the impact would be modest as long as tensions in the Middle East remain unresolved.
