From gas to groceries, the U.S war in Iran is causing the prices to go up.
The average price of gas in the Twin Cities is at about $3.44 a gallon which is among the cheapest in the nation. It's significantly higher nationally at $3.92 while a couple of states are seeing prices well over $4.00 a gallon.
Some analysts think it could up 20% more in the coming weeks, if the war continues.
"So if you think about what you're seeing at the pump as kind of the first stage of how an oil shock affects US consumers."
That's University of St Thomas Associate professor Tyler Schipper telling WCCO-TV the first area of concern is gas and the even higher cost of diesel, but groceries and other goods following closely behind.
"Almost all of your groceries are being carried by a truck either to get onto a train or get off a train or the entire way, and those truckers are going to be passing prices on to whatever cargo they're carrying."
On Monday, relief is ripping through financial markets after President Donald Trump said the United States has talked with Iran about a possible end to their war, despite Iran’s denials. Trump extended his deadline for Iran to reopen the crucial Strait of Hormuz to international shipping, saying Monday that the U.S. would hold off on threatened strikes against Iranian power plants for five days.
"An entire dollar built in in four weeks is a lot," CBS Business Analyst Jill Schlesinger said about the jump in the price of fuel. "We're told this is going to be short term, now it's going to be four to six weeks. Yes, the price of oil and gas is up a dollar a gallon, but diesel prices are up $1.60 a gallon and that affects the transportation costs of almost everything in this country."
Oil prices are falling sharply, and stock prices are jumping on Wall Street following severe losses elsewhere in the world before Trump’s announcement. Whether this is a drawing down of the conflict, or just a pause, is yet to be determined.
"If this had been a one week war, the answer could have been this could have been a big spike and a big come down," adds Schipper.
He says no matter what happens with the war, there has already been permanent damage done to infrastructure in the Middle East, and it will take time to get back up and running.
"You're going to have thousands of ships in the Strait of Hormuz that need to figure out who's going which way, when, and that's going to take weeks if not months to start to normal," Schipper says.
Financial markets have gone through vicious swings up and down since the war began because of uncertainty about how long it may last. The fear is that the war could keep so much oil and natural gas from the Persian Gulf off global markets that it sends a debilitating wave of inflation crashing through the global economy.
Still, the overriding reaction in financial markets on Monday was one of relief. But Schlesinger called the market reaction "wild" so far.
"What I can tell everybody is that it looks a lot better to open your eyes to this at this moment, rather than four hours ago," she said of the early-morning swings. "It's not all over and I think that we should probably expect a lot more volatility."
As the war with Iran drags on, a new CBS News poll finds more Americans are concerned about the war and its direction.
"57% think the war in Iran is going badly for the United States," CBS News Correspondent Ed O'Keefe reports from the White House. "66% say it's a war of choice. About a third say it's a war of necessity. Fewer than one-third believe the administration has clearly stated US.. goals on the conflict."
