Key Takeaways:
President Donald Trump accused Chevron, BP, and ExxonMobil of price gouging and ordered the Justice Department to investigate why gasoline prices haven't fallen as fast as crude oil.
President Donald Trump ordered the Justice Department to investigate Chevron, BP, and ExxonMobil for gasoline price gouging, accusing the three oil majors of failing to pass on crude's 36% decline to consumers.
"The big Oil Companies are not dropping their price at the pump commensurate with the sharply lower prices they are paying for Oil," Trump wrote on Truth Social late Tuesday. "I have instructed the DOJ to immediately start looking into this."
The national average for a gallon of regular gasoline stood at $3.93 Wednesday, according to AAA, down from $4.52 a month ago but still 22% above the $3.22 average a year earlier. WTI crude closed at $73.21 a barrel Tuesday, a 36% decline from its April peak, as the U.S.-Iran interim deal eased supply fears tied to the Strait of Hormuz closure.
Trump said gas prices should be at $2.25 a gallon — a level last seen in 2021 — and the DOJ probe threatens to escalate tensions with an industry that produces roughly 13 million barrels of crude a day in the U.S. The American Petroleum Institute pushed back, saying retail fuel prices "don't move in lockstep with crude oil."
The president's direct naming of Chevron, BP, and ExxonMobil marks a sharp escalation in his public pressure campaign against the energy sector. Speaking to reporters Wednesday, Trump said oil prices "have come down so much and we are not seeing anything at the pump by comparison the way they should be," according to the BBC.
Gasoline prices have declined for six consecutive weeks, with diesel also dipping below $5 a gallon for the first time in weeks, according to GasBuddy data. But the pace of the decline has frustrated the White House. The gap between crude's 36% peak-to-trough drop and gasoline's roughly 13% decline over the same period is at the center of the administration's case.
The American Petroleum Institute, the industry's top lobbying group, said retail fuel prices reflect a complex chain of refining, distribution, and retail costs that don't move in lockstep with crude oil futures. "Our industry shares the goal of delivering relief at the pump and restoring stability to global energy markets," API spokeswoman Bethany Williams said.
Chevron's CFO separately said it would "take time" for gas prices to normalize, according to media reports, signaling the industry expects no quick fix. For a driver filling up twice a month, the difference between current prices and Trump's $2.25 target represents roughly $70 in monthly savings — a sum the White House is betting voters will notice before November's midterm elections.
The easing of gas prices follows the U.S.-Iran interim agreement that reopened the Strait of Hormuz, through which one-fifth of global oil supply transits. The deal has unwound much of the supply premium that built up after Trump's strike on Iran in early 2026, when WTI crude surged above $115 a barrel.
Still, uncertainty remains over whether the interim agreement will hold as the parties negotiate final terms on Iran's nuclear program. The last time oil markets faced a similar supply disruption — following the 2019 attacks on Saudi Aramco's Abqaiq facility — prices normalized within weeks after production was restored. If the current talks collapse, analysts expect crude to retest $100 a barrel, reversing the relief consumers have seen at the pump.
This article is for informational purposes only and does not constitute investment advice.
