Kalshi traders raise odds of U.S. gas topping $4 this month to 88%

Kalshi traders now assign a 92% probability that the U.S. national average gasoline price will rise above $4 per gallon by the end of July, up from the 88% level previously reflected in the market. The contract, which settles against AAA's national average, also prices a 60% chance of gasoline topping $4.10 and a 36% chance of reaching $4.20, while the national average currently stands at $3.89 per gallon after rebounding from early July lows around $3.79. The repricing has come as the conflict involving the U.S. and Iran has intensified again after a brief ceasefire in June. U.S. Central Command struck sites near Bandar Abbas and Greater Tunb Island on July 15, with an evening wave targeting Iranian missile, drone and coastal surveillance capabilities. Iran responded with attacks it described as targeting U.S. assets across Bahrain, Kuwait and Jordan, while Tehran declared the Strait of Hormuz shut and the U.S. reimposed a blockade on Iranian ports near the strait. CENTOM said U.S. forces enforced naval blockade measures on July 15 by disabling an unladen oil tanker attempting to sail toward an Iranian port in the Arabian Gulf. Brent crude climbed to an intraday high of $86 on July 14 and has gained nearly 16% since July 7, while West Texas Intermediate has risen more than 15%. Traders appear to be betting that the increase in crude costs will feed through to retail gasoline prices before month-end, though other prediction markets are less convinced: Polymarket's end-of-July contract shows 57% odds of $4 gasoline. The renewed energy-market focus follows a sharp run-up earlier this year, when the national average gasoline price reached $4.52 per gallon in May, compared with a pre-war level of $2.98 over the prior 72 days. How much further prices climb may depend on whether the conflict broadens or begins to ease.