Why U.S. Energy Independence Doesn’t Shield Us from Price Pain

Global oil prices surged after the U.S. and Israeli strikes on Iran, jumping from under $70 to over $100 a barrel, and energy costs remain sensitive to developments in the region. Moments like this can feel especially heavy. And beyond the human cost and implications for geopolitics, families are wondering what it means for their everyday budgets – gas, groceries, heating, commuting.

If you lived through the oil shocks of the 1970s, today’s headlines may hit you in a very specific, almost visceral way. Long lines at gas stations, sudden price spikes and a sense of economic uncertainty were defining experiences for many Americans. Even if you look back fondly on bell‑bottoms and classic rock, the financial stress of that decade left a deep imprint.

So, when oil prices jump today, it’s natural for those old instincts to kick in, even though the energy landscape – and the economy – function very differently now. And for many, it’s frustrating: If the United States now produces more energy than we consume, why do global oil prices still hit our wallets so hard?

Energy independence is a milestone, but it’s not a force field.

AMERICA PRODUCES A LOT OF ENERGY, BUT STILL LIVES IN A GLOBAL SYSTEM

Today, the U.S. is dramatically more energy self‑sufficient than it was even 20 years ago. After more than six decades as a net energy importer, the U.S. shifted to being a net energy exporter in 2019, from crude oil, coal and natural gas to nuclear power to renewables like wind and solar. That’s what’s known as “energy independence,” and it’s real progress.

After 65 years, the U.S. exported more energy than we imported beginning in 2019

Primary energy, in quadrillions of BTUs.
Source: U.S. Energy Information Administration, as of Feb. 24, 2026.

But “independent” does not equal “isolated.”

We still import certain kinds of crude oil because U.S. refineries are built for specific blends, and global trade often makes it cheaper to import some types and export others. In 2024, roughly 17% of U.S. energy supply came from imports, mostly crude oil and refined petroleum products.

At the same time, we export a lot: nearly 30% of all primary energy production, especially petroleum products and natural gas.

In other words: We’re deeply connected to global markets, both as a seller and a buyer. And global markets – especially oil – set the prices Americans pay.

WHY GLOBAL OIL PRICES STILL HIT HOME

Oil is priced globally by using benchmarks. Brent crude, a North Sea blend and the world’s most widely used benchmark, reacts quickly when instability or violence threatens supply routes – whether in the Middle East, shipping lanes or anywhere else.

West Texas Intermediate, the U.S. benchmark reflecting crude produced in Texas, Oklahoma and North Dakota, usually follows right behind it. The difference between Brent and WTI is usually a few dollars per barrel, reflecting transportation constraints, regional supply conditions and quality differences.

Your gas prices tend to rise quicky when crude oil spikes

Crude oil price reflects West Texas Intermediate.
Source: American Automobile Association and Bloomberg, as of March 9, 2026.

The U.S. still imports a lot of crude oil (it accounts for about two-thirds of energy imports), so we pay those global prices. And even if domestic prices are cheaper, traders can simply buy U.S. oil and sell it abroad at a profit. That pushes up the value of domestic oil and keeps global and domestic prices linked.

INFLATION, BUDGETS AND THE REAL‑LIFE IMPACT

The bottom line is that when global tensions rise, or war disrupts supply, families here feel:

• Higher prices at the pump
• Higher utility bills
• Higher prices on everyday goods as businesses pass along their increased costs

Economists have long noted how oil shocks ripple into inflation. In the ’70s, when the U.S. was much more vulnerable, oil shocks contributed to both high inflation and lower economic growth – better known as stagflation.

Even without broad inflation, higher fuel and utility bills mean less room in the monthly budget for food, rent and everyday expenses. If wages don’t rise faster than energy costs, it has the practical impact of making you poorer.

That’s especially difficult for lower‑ and middle‑income households because they spend a larger share of their income on necessities.

THERE ARE WINNERS – BUT THEY’RE NOT EVENLY DISTRIBUTED

As uncomfortable as it can be to acknowledge, high energy prices also create winners inside the U.S.

Energy companies and their investors typically benefit when oil prices climb. Since the conflict began, energy companies have been among the few areas of the market holding up amid geopolitical and economic uncertainty.

Because millions of Americans invest through diversified retirement accounts, many households benefit indirectly – even if they aren’t thinking about oil investments when they look at their 401(k)s. Edelman Financial Engines clients also hold such diversified exposure, of course.

In this way, rising oil prices tend to redistribute income: All consumers pay more for fuel, but wealthier households with investments in companies producing it will feel the gains.

WHERE ENERGY INDEPENDENCE DOES HELP

All that said, the increase in domestic energy production and our net independence can offer real advantages:

• More stable access to energy. We’re not at high risk of losing supply as we did in the ’70s, especially as far as natural gas. Europe and much of Asia are far more vulnerable to physical shortages.
• A stronger U.S. dollar. Global energy is priced in dollars, which makes oil and gas even more expensive overseas than it is here during times of financial stress.
• More investment and jobs. Higher prices make additional wells and fields economically viable, especially in states like Texas, North Dakota and Pennsylvania. That can mean a surge in hiring, increased wages, new infrastructure and more tax revenue in energy‑producing regions. For those communities, price spikes can feel like an economic boom even as they strain budgets elsewhere.

THE NET EFFECT: STILL A NEGATIVE FOR MOST HOUSEHOLDS

The U.S. is a powerhouse energy producer and, overall, energy independent. That provides resilience and strategic advantages. But in a world connected by trade, conflict and global pricing, it doesn’t shield households from the financial strain of rising oil prices.

Yes, diversified investors and energy‑producing regions may see benefits. But for the nation overall – and especially for families – higher oil prices tend to be a net negative.