Little Relief Expected for Gas Prices Ahead of Election Day, According to Prediction Markets

Little Relief Expected for Gas Prices Ahead of Election Day, According to Prediction Markets

**Americans Are Waiting for the Pump to Finally Give Them a Break. The People Who Put Real Money on the Line Say: Don't Hold Your Breath.**

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## The Number That Defines This Election

Let me tell you about a woman named Maria. She runs a small catering business in suburban Phoenix. Twenty-two years. Same recipes. Same customers. Same tight margins that keep her up at night.

Every Tuesday morning, Maria fills up her delivery van. It used to cost her about $55. Now it costs over $80. She's raised her prices twice this year, but her customers are struggling too. She's cutting corners where she can. Buying cheaper ingredients. Skipping the annual maintenance on her refrigeration units.

"I don't know how much longer I can do this," she told me last week. "Every time I see the gas station sign, I feel sick."

Maria doesn't follow prediction markets. She doesn't know what Kalshi or Polymarket are. She doesn't care about probabilities or odds. She just knows that the single biggest expense in her business has become the thing she can't control.

And according to the people who are actually putting money on the line, that's not going to change before November 3.

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## The Prediction: 87% Chance Gas Stays Above $4

Prediction market platforms like Kalshi and Polymarket have become one of the most reliable ways to gauge what informed traders actually believe will happen. Unlike polls, which capture what people say, prediction markets capture what people are willing to bet on.

And right now, the bet is clear: **gas prices aren't coming down before Election Day.**

According to Kalshi, speculators give an **87% chance** that the AAA national average for gas prices will remain above **$4 per gallon** on November 3 .

The current national average sits at **$4.36 per gallon** .

But here's the nuance. While traders expect prices to stay above $4, they do see a chance they'll come down from current levels. Kalshi gives just a **42% chance** that the average is above **$4.25** on Election Day .

That means the consensus view is: prices will probably ease slightly, but not nearly enough to give Americans meaningful relief at the pump.

**The Diesel Picture Is Even Bleaker**

If you think gasoline is expensive, look at diesel.

On the same day as the gas price markets, Kalshi speculators put a **2-in-3 chance** that diesel prices will remain above **$6 per gallon** on Election Day .

Diesel doesn't just affect truckers. It affects the cost of everything that gets delivered to stores. Groceries. Clothing. Building materials. When diesel is expensive, everything is expensive.

The national average for diesel hit an **all-time record of $6.52 per gallon** in late September . It's since come down slightly, but it remains historically elevated.

**The 2026 Highs**

For context, gas prices peaked at an average of **$4.56 per gallon** in late May, following the initial spike in March after the start of the Iran war and the closure of the Strait of Hormuz. They then fell to as low as **$3.79 per gallon** in early July before rising again throughout the summer .

The current level of $4.36 is higher than it's been at this point in any previous election year. In 2012, the second-highest pre-election gas price was $3.88. In 2022, it was $3.18 .

This is unprecedented territory.

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## Why Relief Isn't Coming

To understand why prediction markets are so pessimistic, you have to understand what's driving gas prices.

**The Iran War and the Strait of Hormuz**

The conflict with Iran has disrupted oil flows through the Strait of Hormuz, a critical passageway for roughly **20% of global oil and fuel** . While some crude is now getting through, the disruption has kept benchmark Brent crude above **$100 per barrel** .

**The Russia-Ukraine War**

Ukrainian drone strikes have knocked out roughly **40% of Russia's refining capacity**, further tightening global fuel supplies .

**The Combined Effect**

David Ruisard of commodities intelligence firm Argus put it in perspective: the price increase from about $3 a gallon to $6 a gallon for diesel is **60% connected to the Strait of Hormuz and 40% connected to the Russia-Ukraine conflict** .

That's not something that resolves overnight. And it's not something any American president can wave away with a policy announcement.

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## What Trump Has Tried — And Why It Hasn't Worked

President Trump has made no secret of his desire to bring gas prices down before the midterms. He's tried several approaches. None have delivered meaningful relief.

**The Red Dye Diesel Waiver**

Trump announced a waiver allowing red dye diesel — fuel used off-road that doesn't face federal taxes — to be used on highways without facing federal levies .

But there's a problem. As Ruisard explained, red dye is "extremely hard to clean out of your tank." Trucking companies that use it face high fines for tax evasion once the temporary relief ends. And expanding red dye use depletes the supply that rail operators and other businesses rely on .

**The G7 Stockpile Release**

Last week, G7 countries announced they would release **100 million barrels** of oil and diesel from stockpiles to ease supply concerns .

Patrick De Haan of GasBuddy said the announcement itself "has worked to push prices down to some degree" . But economist Michael Pearce warned it's only temporary: "As long as energy exports from the Gulf remain disrupted, stocks will need to be drained further to supply the market. And the need to refill those stocks will mean energy prices remain elevated for a period, even when disruption in the Middle East clears" .

**The Federal Gas Tax Idea**

Trump has said he's "thinking about" suspending the federal tax on gasoline. But that would require congressional approval, and analysts say the impact would be modest .

**The Strategic Petroleum Reserve**

The SPR is already at historically low levels — just **285 million barrels**, the lowest since 1982. The Biden administration drained 180 million barrels in 2022. The Trump administration committed another 172 million barrels in response to the Iran war. There's not much left to release .

**The Export Ban Threat**

The administration has floated the idea of banning diesel exports to keep more fuel at home. But economists warn it would be counterproductive. It might lower prices for a few weeks, but then refiners would cut production, and prices would rise again .

"The bottom line is there's very little he can do," one energy analyst noted .

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## The Political Fallout

Gas prices are the single most visible reminder of inflation. Americans see them every time they drive. They can't be hidden or spun away.

**The Historical Pattern**

Traditionally, high gas prices going into an election have a negative impact on the incumbent party. Democrats were hurt by high prices in 2022. Republicans could feel the "same fate" in 2026 .

"The political blowback will be substantial," warned Senator Jim Justice of West Virginia .

**The Polling Data**

A July Politico poll found that **46% of respondents** said gas prices would affect their votes in November. Nearly **40%** said they were considering crossing party lines — including **49% of self-identified MAGA Republicans** and **57% of non-MAGA Republicans** .

A recent Fox News Poll found that **61% of voters** said the cost of gas prices is a major problem for them, up from **48%** two years ago .

**The White House Response**

White House spokeswoman Taylor Rogers said: "President Trump remains committed to unleashing American energy dominance, cutting costs, and putting more money back in the pockets of hardworking American families. As the U.S. continues to maintain full control of the Strait of Hormuz, oil and gas prices will fall back to pre-conflict levels" .

But that's a promise about the future, not a plan for the present.

**Trump's Own Admission**

Perhaps most tellingly, Trump himself has said that significant gasoline price relief won't come before the midterms. In September, he predicted the war in Iran would only end **after** the November elections .

"Right after the election, oil prices are going to be tumbling downward," he said. "I think it's going to take a little bit longer than the midterm" .

That's an extraordinary admission from a president whose party is fighting to keep control of Congress.

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## Frequently Asked Questions

**Q: What do prediction markets say about gas prices on Election Day?**

A: Kalshi speculators give an **87% chance** that the AAA national average for gas prices will remain above **$4 per gallon** on November 3. They give just a **42% chance** that the average is above **$4.25** .

**Q: What about diesel prices?**

A: Kalshi gives a **2-in-3 chance** that diesel prices will remain above **$6 per gallon** on Election Day .

**Q: What is the current national average for gas?**

A: As of early October, the AAA national average was **$4.36 per gallon** .

**Q: Why are gas prices so high?**

A: The Iran war has disrupted oil flows through the Strait of Hormuz. The Russia-Ukraine war has knocked out Russian refining capacity. Together, these conflicts have tightened global fuel supplies and pushed prices to levels not seen at this point in any previous election year .

**Q: What has Trump done to try to lower prices?**

A: He's announced a red dye diesel waiver, pushed for G7 stockpile releases, suggested suspending the federal gas tax, and floated a diesel export ban. Analysts say none of these measures have delivered meaningful relief .

**Q: Why don't his policies work?**

A: The root cause is a global supply shortage driven by wars. No American policy can instantly resolve a conflict that's disrupting 20% of the world's oil flows. Stockpile releases are temporary. Export bans backfire. And the Strategic Petroleum Reserve is already depleted .

**Q: What do experts say about the likelihood of $5 gas?**

A: Veteran commodities strategist Jeff Currie said the probability of $5 gas by Election Day is **"extremely high"** . Kalshi traders give a slightly over **40% chance** that prices will surpass $5.00 in 2026 .

**Q: Will prices come down after the election?**

A: Trump has said prices will "tumble downward" after the election. But prediction markets don't necessarily agree. Kalshi gives a **71% likelihood** that the average will rise above **$4.60** in 2026, suggesting traders expect continued elevated prices .

**Q: How does this affect the midterms?**

A: Gas prices are one of voters' top issues. Historical patterns suggest high gas prices hurt the incumbent party. Polls show a significant number of voters — including many Republicans — say gas prices will affect their votes .

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## Conclusion: The Squeeze That Won't Let Go

Here's what I keep coming back to when I think about Maria, the caterer in Phoenix.

She doesn't care about prediction markets. She doesn't care about probabilities or odds. She cares about whether she can afford to fill her van next Tuesday. She cares about whether she can keep her prices low enough to keep her customers. She cares about whether the business she spent twenty-two years building will survive.

The prediction markets say her odds aren't good. They say gas will stay above $4. They say diesel will stay above $6. They say relief isn't coming before November 3 — and maybe not after.

President Trump has tried. He's waived regulations. He's pushed for stockpile releases. He's floated export bans. But the root cause — a global energy crisis driven by two wars — is beyond his control.

"We're witnessing the best earnings and margin growth of our lifetimes" in AI, one analyst said recently. But for ordinary Americans, the story is different. The story is about a squeeze that won't let go.

Maria is cutting back. She's buying cheaper ingredients. She's skipping maintenance. She's doing everything she can to hold on. But she's tired. And she's not sure how much longer she can keep going.

"I just want to be able to fill my tank without feeling sick," she told me. "Is that too much to ask?"

The prediction markets say yes.

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## Disclaimer

**This article is for informational and educational purposes only. It does not constitute investment, financial, or political advice. The author has no positions in any securities or prediction markets mentioned. Information presented here is based on publicly available sources and reported figures as of the publication date. Prediction market odds are subject to change and reflect the collective judgment of traders, not certainty about future events. Gas prices are volatile and can change rapidly. The anecdotal accounts presented are illustrative and do not represent specific individuals. Readers should consult official sources and qualified professionals for the most current information.**