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Market Chatter: White House Weighs Gas Tax Cut as Iran Conflict Pushes Fuel Prices Higher

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The White House is reviewing emergency fuel-price relief options as US gasoline prices remain above $4.50 per gallon during the Iran conflict, Reuters reported Thursday, citing people familiar with the matter.

The Trump administration is considering suspending the federal gasoline tax, a move that could lower pump prices by 18 cents per gallon.

Officials previously viewed the proposal as unnecessary, but growing fuel costs and economic concerns are increasing pressure on the administration to act.

One person familiar with the discussions said the White House now believes Trump needs "a visible consumer relief move now" after gasoline prices jumped 50% since the war started.

US consumer inflation rose to 3.8% in April, the highest level in nearly three years, while consumer confidence recently fell to a record low during the conflict, the report added.

A Reuters/Ipsos poll conducted in May showed over 60% of Americans said rising gasoline prices had negatively affected household finances, while Trump's economic approval rating dropped to 30%.

Republican lawmakers are growing concerned that higher fuel costs and economic pressure could damage the party's chances in November's midterm elections.

White House officials are also tracking whether national gasoline prices could climb to $5/gal, according to the source, while American Automobile Association data showed prices have already crossed that level in seven US states.

The White House did not immediately respond to' request for comment.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)]

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