Iran War Costs Hit American Households as Gas Prices Rise

The war on Iran ran two contradictory tracks on the same day. President Donald Trump threatened to strike Oman -- "Oman will behave like everyone else, or we'll have to blow them up" -- if the sultanate moved to jointly regulate the Strait of Hormuz with Iran, a warning aimed at the Gulf's most trusted mediator and one that regional analysts judged highly unlikely to be carried out. At the same time, the diplomatic track wobbled: Iran's semi-official Fars news agency rejected Trump's public account of a reported agreement as "a mixture of truth and falsehood," said a draft understanding was still under review in Tehran, and a source close to the talks put the last major sticking point at $24 billion in Iranian funds frozen worldwide -- double the $12 billion cited earlier in the week.

The war's price was most visible at the pump. AAA put the national average for regular gasoline at $4.39 a gallon, down 16 cents over the week as ceasefire talks advanced but still far above the roughly $3 Americans paid before the war, and oil eased on hopes the Strait of Hormuz might reopen. The shock has spread well beyond fuel: with the strait shut, roughly half of globally traded sulfur and 36 percent of traded urea have come off the market, pushing US anhydrous ammonia up almost $300 a ton and sulfuric acid from $155 to $400 a ton -- a squeeze compounded by a Chinese ban on sulfuric-acid exports on May 1 that is now feeding into American farm costs.

Away from the war, the domestic economy showed its own strain. New work from Federal Reserve economists and the Yale Budget Lab found that the sharp slowdown in population growth driven by Trump's immigration crackdown is weighing on hiring and productivity: the Fed analysis put the breakeven rate for monthly job gains close to zero, while Yale projected a population shortfall of up to 4.6 million people, with lasting damage to labor-force growth. Separately, a federal judge in Washington, Carl Nichols, this week declined to block Trump's executive order overhauling mail-in voting, ruling it premature because the directives -- which would have federal agencies build lists of eligible voters -- have not yet been carried out; nearly two dozen states and the District of Columbia have filed five lawsuits against the order.

Washington's posture abroad was also shifting. Germany's Der Spiegel reported that the United States plans a "drastic" reduction of its core military contributions to NATO -- fighter jets, warships, drones and refueling aircraft -- building on an earlier plan to halve its deep-strike capability in Europe, with allies expected to present plans by July to fill the gap. The report landed the same day a Russian drone struck an apartment block in NATO-member Romania, sharpening European anxiety about how much of the continent's defense Washington still intends to carry.