Business Rundown: Could $2 Gas Return Sooner Than You Think?

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I'm Jerry Willis and this is The Fox Business Rundown.

Friday, March 13th, 2026.

Highton prices are stirring in fresh inflation fears, but President Trump is trying to cool

concerns about rising oil prices that spiked above $100 per barrel this week.

And the administration put the brakes on surging gas prices.

Once we get back to normalcy in terms of world oil production and world oil demand,

that we could see the price of gasoline go below $2 a gallon.

Joint military operations between the U.S. and Israel continue in Iran where traffic

and the Strait of Hormuz has slowed, open only to Iranian and Chinese flag transports.

The result, gas prices taking to highs that have been reached in years.

The U.S. weighing how to ensure safety for commercial shipping and the Strait of vital

choke point for 20 percent of the world's oil, as Tehran threatens to shut down the

route completely.

The Trump administration plans to release millions of barrels of oil from the strategic

petroleum reserve in an effort to cushion the blow.

How effective will that decision prove to be and how is this impacting our economic outlook?

Oil and energy are key to everything we produce.

See more is a former senior economic advisor to President Trump and the co-founder of Unleashed

Prosperity now.

And so historically over the last 50 or 60 years, we've seen every time the gas price and

the oil price goes up, so does the consumer price index for buying everything from home

to groceries to help care.

And so in a time when we're trying to bring prices down, it's very key that we hold

down the energy prices as much as possible.

They've spiked up, but there's a great hope at the White House and with them a lot of

economists that as soon as we get this Iran situation figured out that we'll see a return

to the gas prices we saw before this war began.

And that's below $3, a gallon, that was a beautiful thing, a two handle on that, everybody

likes that.

You wrote a great piece about oil, the U.S. production of oil at new highs.

We dominate the market.

You made this point and then you said something that I think people forget because most people

haven't been around a long time.

The Middle East, you say, has always been an unreliable source of energy for the U.S.

since the 1970s, prices have spiked whenever there is turmoil in the region.

So what does that tell us about what we need to be doing today?

Well, the fact is when we are reminded of all of the disruptions that have happened

over the last 50 years in the Middle East, I mean, I'm old enough to remember the 1970s

when we used to have to load up in my parents' station wagon and be seventh in line to get

gasoline in the morning.

So the battle of days.

Everybody knows that when we have these flare-ups in the Middle East, the global price

of oil rises.

And this is why Donald Trump's energy strategy has been so smart.

The more we can produce at home, the less we're reliant on Middle East oil.

Now, that doesn't mean that we can be completely independent.

In fact, we actually produce more oil today and more gas today than we consume.

And that's the first time that's happened in a long, long time.

But we're still somewhat vulnerable as we've learned in the last few weeks to what happens

in the Middle East because, as you know, Jerry, oil is a global commodity.

So when we have a disruption anywhere in the world, we saw that with Russia during the

beginning of the Ukraine war, it can send prices everywhere shooting to the moon.

And so I guess I would say that the Trump doctrine on energy is drill-baby drill as much

as we can here because the truth is we have more energy than any other country does.

Just to underline what you're saying here, the DOE Department of Energy reporting that

U.S. crude oil production reached record high output in 2025 last year, 13.6 million barrels

per day, 24 million barrels per day of oil and liquid fuels.

That's more than Russia and Saudi Arabia combined people.

We're a big player, drill-baby drill.

It's really happening in this country.

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I want to switch you up a little bit to the economy because we had some important economic

news out.

Fourth quarter GDP coming in lighter than anticipated at 0.7%.

And as the Trump administration has promised, can growth accelerate substantially in the

quarter we're in right now, given the tax benefits working their way through the economy

from the one big beautiful law?

What do you see for the first quarter?

Yeah.

So I'm super bullish on the US economy, medium and long term.

But look, this disruption that we've seen in Iran has caused oil prices to go up as

high as $100 a barrel.

This attacks on the American economy when that happens.

So I think we're going to see a pullback on growth in the first quarter.

But if Donald Trump is right that this will be over in a month or so, then we could see

an explosion of growth over the rest of the year.

You know, 2025 was a very good year for the economy.

We had solid economic growth.

We had big gains in medium family income.

We saw low gas prices.

All of that was highly effective for the US economy.

I think those tax benefits are going to be impressive once you understand what's really

happening here.

It's not until you actually get your refund that I think a lot of people will be like,

oh, that's really working on for me.

Well, Jerry, you know, you make a good point.

A lot of people would come up to me over the last several months and they'd say, hey, Steve,

where's that tax cut out?

We're supposed to get.

And I say, well, wait, I said, you know, it's coming.

And people have now started to field in their paychecks in January and February and

March, because less money is being withheld from their paychecks.

And for the average family, the House Finance Committee believes that that will save the

average family anywhere from $1,500 to $2,000, that is to say they're going to have that

much more money in their paychecks this year.

That's amazing.

And you know where that goes right at the door, typically, right?

Now, we are big spenders.

We Americans want to ask you about another economic number out PC inflation coming in

in line.

Actually, you're over here.

2.8%.

It was a little lower than the street expected.

How do you feel about lingering inflation in this economy?

You've addressed that if the war in Iran isn't over soon, it could not be good.

If the war stops in short order, can we lick this inflation problem?

Well, Trump was well on the way of doing that.

No question about it.

In fact, three months before the Iran bombing, we were running an inflation rate monthly

at closer to 1.5%, which, as you know, is below the fat target of 2%.

So we were well on the way, but we've had this big disruption in the supply of global

oil right now.

And that is going to mean we're going to probably have several months of rising consumer

prices.

But it's so interesting.

You look at the futures market for oil, you know, you can buy oil six months from now,

nine months from now, a year from now, all of those indicators suggest that the markets

believe that oil will go right back down to where it was before this fighting started.

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Steve, you know, we talked a lot at the beginning about the straight of Hormuz, or at least

I did, about this bottleneck, this critical juncture in which very few tankers are

getting through.

Let's imagine a world where the U.S. dominates there, and there's the free flow of oil all

the time.

Isn't that net net a huge benefit, not just to us, but to the global economy?

Yeah, no question about it.

And in fact, the world is really a wash and oil and gas right now because of all the

new drilling techniques, the shale oil and gas revolution that happened here in the United

States that have made America almost overnight, the number one oil and gas producer, I believe

that once we get back to normalcy in terms of world oil production and world oil demand,

that we could see the price of gasoline go below $2 a gallon.

Once we get back to the situation we had before this flare up in Iran, and that would be

amazing because that's a huge tax cut for American consumers and families.

You know, as you said, people love the two-handle, wouldn't they love to see a one-handle?

My jaw is on the floor here where I am, I'm stunned to even think of a $99, $80, $85

gas to me.

Let me just add, let me just add one other thing on gas prices, you know, there's a wide

disparity of prices for gas around the country.

So as I think you know, the state with the highest gasoline prices is California, but those

are self-inflicted loans.

California has so many rules and regulations about the production of oil and gas that they

are now paying about $1.25 to $1.50 a gallon more than the national average.

And that's a strange thing because actually California is one of the most well-endowed

states in the country in terms of having amazing petroleum products.

They just shoot themselves enough, foot over and over and over again, don't they?

And if you're a consumer there, you must be thinking, why am I living here and experiencing

this such a high cost of living compared to other states?

Well, I saw a report recently that show that California has the highest cost of living

in the country.

It does.

So, yeah, that's been the case in virtually all of the blue states.

The highest cost of living states in America are California, New York, New Jersey, Connecticut,

Illinois.

Gee, what are those policy states having done?

The high taxes, high regulation that make it very expensive places to live.

By the way, Texas has virtually the lowest cost.

And now they're one of the major sources of oil and gas production in the world, but

it makes a lot of difference.

And so, when Gavin, when, and if Gavin Newsom runs for president, they kept Governor of

California using app to explain to American people why it is the gas and oil are so expensive

in California.

And if so, if he's president, is he going to raise prices nationally to the levels they

are in California?

Great question.

Great question.

Great question.

Something to worry about.

Yeah, in case you didn't have anything this week.

Well, from your looks to God's ear, this war winds down soon and Americans can get back

to business and stopping glued 24-7 to the headlines on TV and elsewhere.

See more.

Thank you so much.

Thank you, Jerry.

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