With the war in the Persian Gulf now more than a month old, the impact on fuel prices is clearly visible: On average, they are up about a dollar a gallon, or 25 percent, according to AAA. This is bad news for an automotive-addicted country like ours. Except, of course, for electric vehicles.
The last half year has been a tough one for EV adoption in the US. Late last September, the Trump administration eliminated federal tax credits for both new and used EVs, one of a series of policies that have discouraged automakers from making EVs and consumers from buying them. Battery factories have been canceled or repurposed, and EV lineups have been cut as OEMs write off billions of dollars in the process.
Some analysts are predicting a particularly dire Q1 2026. For example, Cox Automotive forecasts a 6.5 percent overall decline in new car sales for the first three months of the year, but a 28 percent decline in EV sales for the same period. Without continued high fuel prices, Stephanie Valdez Streete, Cox’s director of industry insights, expects people will make fewer trips. “To truly change purchasing behavior and drive the trend toward smaller, more efficient vehicles, consumers need to believe that gas prices will remain high for years, not just months,” Cox said.
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