Get Used to One New Reality: Rising Gas Prices

Drivers who track gas prices are in for an unpleasant surprise: The average cost of a gallon in the US rose 11 cents overnight to $3.11, reports the AP, citing data from the motor club AAA. The reason is no surprise: The Mideast is now engulfed in war, which has put the global oil market in what CNBC sees as a "worst-case scenario." Iran has effectively shut down the Strait of Hormuz, stifling a significant chunk of the world's oil shipments, and it continues to launch retaliatory attacks on neighboring nations' energy facilities. Brent crude, the international standard, rose about 9% to to $81 a barrel on Tuesday morning. How much more it rises—taking gas prices along for the ride—depends on how the war goes:

• Best case: If hostilities end quickly, within a week or so, CNBC expects oil prices to tick back down to between $60 and $70 a barrel. In the meantime, expect gas prices to rise about 30 cents this week, a petroleum analyst at GasBuddy tells CNBC.
• Not so great: If the war continues for more than three weeks, the price may hit $120 a barrel, a level not seen since the early days of Russia's invasion of Ukraine. When that happened, gas prices eventually rose to a record national average of over $5 a gallon. The Washington Post expects gas prices of at least $4 a gallon should the oil price remain above $100.
• It's dire: If Iran manages to shut down the Strait of Hormuz for a sustained period with, say, land mines and attacks on ships, one analyst tells CNBC that oil could hit $200 a barrel. Gas prices would almost certainly hit new highs at that point.