(NEW YORK) -- Gasoline prices in the United States hit their highest level in four years on Tuesday as negotiations over the Iran war appeared to show little signs of a resolution.

This is a developing story. Please check back for updates.

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(OAKLAND, Calif.) -- Billionaire entrepreneur Elon Musk and prominent AI executive Sam Altman are facing off in court with major implications for OpenAI, the San Francisco-based tech giant led by Altman.

The federal case, which concerns OpenAI's evolution from nonprofit to profit-seeking, kicked off on Monday in Oakland, California. Judge Yvonne Gonzalez Rogers is managing proceedings alongside nine jurors and no alternates, according to a court filing last month.

The star-studded list of potential witnesses includes Altman, Musk and Microsoft CEO Satya Nadella, among other tech luminaries, a court filing showed.

Musk sued OpenAI and Altman, its CEO, in 2024, alleging that the company abandoned its mission of benefiting humanity in a sprint toward profits.

Musk, a co-founder of OpenAI, said he reached an agreement with the company's leaders on the nonprofit course of the firm when it launched in 2015. The company later breached that "Founding Agreement," Musk said in a 2024 court filing, when it made ChatGPT-4 available for use by Microsoft -- the tech giant got access to the then-most powerful version of its popular chatbot under an exclusive licensing agreement.

Microsoft and OpenAI have renegotiated the exclusive licensing agreement, allowing OpenAI to strike deals with other tech firms.

OpenAI has rebuked the charges, calling them "baseless." Microsoft has also denied any wrongdoing. Musk, the world's richest person, counts $839 billion in wealth, according to Forbes. He is seeking $150 billion in damages from the tech companies.

OpenAI, which is not publicly traded, valued itself at $852 billion after a round of funding in March. Microsoft's value -- as measured by market capitalization -- stands at about $3.1 trillion.

After jury selection, the case will take place in two sections, Gonzalez Rogers said in a court filing. An initial phase will focus on liability to determine whether any of the defendants committed illegal acts. A subsequent remedies portion will assess potential damages.

Musk and the OpenAI defendants will each be afforded 22 hours to present their case during the liability phase, Gonzalez Rogers said in a court filing earlier this month. Microsoft, also a defendant, will be given five hours for its case.

Musk will plead two claims against OpenAI: unjust enrichment and breach of charitable trust, according to a legal filing last week.

"OpenAI, Inc. has been transformed into a closed-source de facto subsidiary of the largest technology company in the world: Microsoft," Musk said in the lawsuit.

Typically, deals established between a top investor and company leadership are set out in writing with concrete terms, some experts previously told ABC News, leaving Musk in a difficult position as he attempts to invoke what they say appear to be spoken commitments made years ago without a formal contract.

For his part, Musk says in the lawsuit that the agreement was memorialized in a legal filing when OpenAI was incorporated.

In the lawsuit, Musk alleges that Altman and OpenAI President Greg Brockman reaffirmed the founding agreement in written messages over the ensuing years.

"[I] remain enthusiastic about the non-profit structure!" Altman wrote to Musk in 2017, according to the lawsuit.

Musk, who helped bankroll OpenAI, launched a rival AI company in 2023 called xAI, which built a chatbot that competes with ChatGPT.

Acknowledging his previous criticism of the pace and ambitions of AI development, Musk said in a conference call on X in July 2023 that he entered the industry reluctantly.

In the lawsuit, Musk alleges breach of contract, breach of fiduciary duty and unfair business practices.

Musk is seeking a legal order that requires OpenAI to abide by its alleged founding mission of aiding humanity and retaining its nonprofit form, as well as compensation for the funds received by OpenAI while it carried out allegedly unfair business practices.

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(NEW YORK) -- The United Arab Emirates on Tuesday said it would leave the Organization of the Petroleum Exporting Countries (OPEC) next month.

This is a developing story. Please check back for updates.

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(NEW YORK) -- General Motors said on Monday it expects to receive $500 million in refunds from tariffs that were ruled illegal by the Supreme Court.

The automaker is now boosting its full-year profit forecast by $500 million, GM CEO Mary Barra said in a letter to shareholders as the company announced its Q1 results. Barra also cited strong sales of its full-size pickup trucks, despite rising gas prices. 

The federal government opened last week its refund portal to allow companies to apply to get tariff money back. The Supreme Court ruled in February that the International Emergency Economic Powers Act did not give President Donald Trump the power to unilaterally impose tariffs.

GM is one of more than 330,000 importers who paid the IEEPA tariffs that were invalidated, totaling $166 billion.

The IEEPA tariffs alone cost the typical American household $700 last year, according to the nonpartisan Tax Foundation.

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(NEW YORK) -- Thousands of canceled flights in Europe over a spike in jet fuel prices. An energy emergency declaration in the Philippines. A two-week school holiday in Pakistan to conserve fuel used by commuters.

The U.S.-Israeli war with Iran triggered dramatic steps in a slew of countries bent on weathering one of the worst oil shocks in history, stoking concern by some about a possible global recession.

Economists disagree about whether the standoff in the Strait of Hormuz will ultimately drive the world's economy into a downturn, in part because the duration of the waterway's effective closure remains murky. The outcome holds implications for the livelihoods of billions of people and the performance of companies big and small across the globe.

Some analysts said they fear the oil shortage will soon become so dire that crude prices could rise sharply driving up costs for an array of goods and hammering shoppers. The fallout could squeeze businesses and shrink growth, they said.

Others proved more optimistic, pointing to a smaller rise in oil prices than some feared and a recent track record of economic resilience in the face of trade wars and other turmoil. A worldwide downturn, they said, would require a much more prolonged closure of the strait.

"The longer this drags on, the costlier it becomes," Ryan Sweet, chief global economist at Oxford Economics, told ABC News.

Still, Sweet added: "Whether or not this will cause a global recession, it's premature to say."

The conflict, which began on Feb. 28, prompted Iran's effective closure of the Strait of Hormuz, a critical waterway that facilitates the transport of about one-fifth of the global supply of oil and natural gas.

The vast majority of oil that passes through the strait is bound for Asian markets. But since oil prices are set on a global market, prices have climbed for just about everyone as buyers chase fewer barrels of crude.

On Tuesday, Trump extended a ceasefire with Iran, averting a resumption of wide hostilities, although the move left the strait under Iran's effective control. The U.S., meanwhile, has mounted a blockade of Iranian ports in the strait, squeezing a key source of government funds derived from oil exports, while exacerbating the global petroleum shortage.

The Brent futures price, the benchmark index for global oil trading, registered at about $106 a barrel on Friday. That price stood about 50% higher than its pre-war level.

Higher oil and gasoline prices risk a pinch at the pump, as well as additional costs for just about every product delivered across the globe on trucks or ships that run on diesel fuel.

"Oil feeds into inflation, which reduces raw purchasing power -- how much bang for their buck people have," Sweet said. "That slows the economy."

Still, oil prices remain below the highs reached after some previous economic shocks. In 2022, the price of Brent crude surged above $139 per barrel in March, just weeks after the Russian invasion of Ukraine. During the 2008 financial crisis, U.S. gasoline prices shot up as high as $147 a barrel.

Some economic forecasts issued in recent weeks projected that global economic growth could escape the crisis relatively unscathed, as long as the war reaches a resolution in short order and oil prices avoid a steeper climb.

The Organisation for Economic Co-operation and Development (OECD) last month predicted that global gross domestic product (GDP) growth would "remain broadly stable" at 2.9% in 2026. That forecast matched projections issued by the OECD in December, before the war.

The OECD touted strong tech investment and lower-than-expected tariffs, citing "carry-over from robust outcomes in 2025."

Earlier this month, the International Monetary Fund (IMF) projected that GDP growth would register at a solid pace of 3.1% in 2026, noting that the global economy had withstood "higher trade barriers and elevated uncertainty last year."

The forecasts from the OECD and IMF worked under the assumption of a resolution to the conflict by the middle of this year, acknowledging the impact could worsen if it stretches on for longer.

Some economists, by contrast, consider the economic threat a more urgent risk.

Paul Krugman, an economics professor at the City University of New York Graduate Center and a former columnist at the New York Times, criticized the IMF projection on Substack on Monday, faulting the group for "seriously underestimating how badly the global economy could be hit."

"In my view, a full-on global recession is more likely than not if the Strait remains closed for, say, another three months, which seems all too possible," he said.

Rosier forecasts fail to adequately factor in the risk of a significant rise in oil prices over the near term, Krugman said, warning of widespread "demand destruction" as oil becomes increasingly scarce. Under such a scenario, a surge in oil prices would make it unaffordable for many buyers, forcing them to find alternatives or forgo energy use altogether.

Technical definitions vary about what constitutes a global recession, but the gist is a period of sluggish or negative economic growth. For the World Bank, a global recession amounts to a contraction in global per capita GDP; while the IMF considers GDP growth below 2% sufficient to warrant the label of a recession.

A six-month impasse in the strait could push global oil prices as high as $190 in August, Oxford Economics said in a blog post last month. That price shock would send global inflation to 7.7%, near its peak in 2022, the independent economic advisory firm said.

"But unlike 2022, when the global economy kept growing through the price shock, the severity of this disruption tips the world into outright contraction," Oxford Economics added.

In addition to its optimistic baseline projection, the IMF issued a downbeat prediction in the event of a more severe disruption of oil markets that stretches into next year. Under those circumstances, the global economy "would come close to experiencing a recession," the IMF said, noting that it defines a global recession as annual GDP growth below 2%.

Growth below 2% has happened four times since 1980, the group said.

Across the board, economists acknowledged a high degree of uncertainty as the Iran war unfolds. Plus, some said, the negative effects will be unevenly distributed, hitting harder in low-income countries as well as those who depend on oil that passes through the strait.

While the full extent of economic wreckage remains unknown, the prospect of an extended global impact is all but certain, Sweet said.

"This will take a long time to get back up to resembling anything close to normal," he added.

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(NEW YORK) -- Warner Bros. Discovery shareholders on Thursday voted to approve the Paramount Skydance takeover bid, completing a major step toward the $111 billion media mega-deal.

The offer from Paramount encompasses the HBO Max streaming service, the Warner Bros. film production company, and cable channels such as CNN. Assets owned by Paramount include CBS, Paramount Pictures and Comedy Central, among others.

Shareholders cast ballots "overwhelmingly" in support of the Paramount takeover, Warner Bros. Discovery said in a statement.

"Today's stockholder approval is another key milestone toward completing this historic transaction that will deliver exceptional value to our stockholders. We will continue to work with Paramount to complete the remaining steps in this process that will create a leading, next-generation media and entertainment company,” Warner Bros. Discovery CEO David Zaslav said in the statement.

Shares of Paramount fell nearly 5% in the minutes following the announcement on Thursday morning.

In December, Paramount launched a hostile takeover bid to acquire Warner Bros. Discovery, just days after Netflix struck a deal to purchase a large part of the media giant.

The rival, multi-billion-dollar efforts to acquire streaming platform Warner Bros. Discovery threatened to upend the media industry and shape content viewed by hundreds of millions of people.

Paramount appeared to gain the upper hand in the bidding war in recent months. In February, the Warner Bros. Discovery board of directors voted unanimously to recommend approval of the Paramount takeover.

Under the terms of the deal, shareholders will receive $31 per share, which amounts to a 147% premium, Warner Bros. Discovery said in March.

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(WASHINGTON) -- President Donald Trump’s selection to chair the Federal Reserve, Kevin Warsh, testified in a Senate confirmation hearing on Tuesday as his nomination faces bipartisan opposition centered on a federal criminal investigation into the central bank’s current leader.

The probe into Fed Chair Jerome Powell, which focuses on alleged false testimony to Congress about an office renovation, threatens to derail or delay Warsh’s nomination.

Powell, who was appointed by Trump in 2017, has rebuked the probe as a politically motivated effort to influence interest-rate policy.

In his opening remarks, Warsh voiced support for the independence of the Fed in its role setting interest rates. He used the term "monetary policy" to describe the central bank's task of adjusting benchmark borrowing costs.

"Monetary policy independence is essential. Monetary policymakers must act in the nation’s interest," said Warsh, a former Fed official.

Still, Warsh defended the right of public officials, including presidents, to voice their views on interest-rate policy, saying such comments do not infringe on Fed independence.

"Central bankers must be strong enough to listen to a diversity of views from all corners," Warsh said.

Warsh said he welcomes collaboration with the White House and Congress on "non-monetary matters that are part of the Fed’s remit," such as banking regulation.

Sen. Elizabeth Warren, D-Mass., the top Democrat on the committee, responded directly to Warsh's defense of a president's right to criticize the Fed, saying the federal investigation of Powell amounts to a pressure campaign that extends beyond public criticism of Fed policies.

"You said it’s perfectly fine for elected officials to state their views on interest rates. But that’s not what Donald Trump is doing," Warren said, addressing Warsh.

The investigation of Powell, Warren added, is "designed to threaten all the members of the Fed to do Trump’s bidding."

Warsh may become Trump's "sock puppet" atop the Fed, Warren said.

When the Department of Justice's investigation into Powell became public, in January, Trump denied knowledge of the probe, NBC News reported at the time.

Later in the hearing, Warsh told Sen. John Kennedy, R-La., that he would “absolutely not” be a sock puppet for Trump.

"I'm honored the president nominated for the position, and I'll be an independent actor if confirmed as chairman of the Federal Reserve," Warsh said.

Sen. Tim Scott, R-S.C., the chairman of the Senate Banking Committee, praised Warsh, saying the Fed nominee would focus Fed policy on economic stewardship. During the tenure of President Joe Biden, Scott claimed, the Fed shifted some of its attention to the implications of issues like climate change.

“An independent Federal Reserve is essential to achieving its mission. That independence must be protected," Scott said.

"Kevin Warsh is battle-tested and brings the necessary experience," Scott added.

Sen. Thom Tillis, R-N.C., a potentially decisive vote on the committee, says he will not move to advance Warsh's nomination until the Department of Justice resolves its unprecedented investigation into Powell.

Powell's term as Fed chair ends on May 15, but he said last month he would stay in the position until Warsh is confirmed. For his part, Trump told Fox Business last week he would fire Powell if the current Fed chair attempts to remain in office past the end of his term.

Warsh, who previously worked on Wall Street and in the President George W. Bush administration, brings experience in finance and policymaking.

He is currently a fellow at a conservative think tank called the Hoover Institution, which is based at Stanford University. He also works as a partner at the Duquesne Family Office, an investment firm founded by billionaire and former hedge fund manager Stanley Druckenmiller.

In 2006, Bush appointed Warsh to serve on the Fed’s Board of Governors, a top policymaking body that helps set the level of interest rates, where he served until 2011. His tenure overlapped with the 2008 financial crisis, during which he helped manage the central bank’s response under then-Chair Ben Bernanke.

The nomination of Warsh arrives at a delicate moment for the Fed, as it grapples with a challenging combination of elevated inflation and sluggish hiring. An interest-rate hike could help ease inflation but risks a further cooldown of the labor market, while a rate cut may boost hiring but threatens higher inflation.

During his term as a Fed governor in the late 2000s and early 2010s, Warsh gained a reputation as an interest-rate “hawk,” meaning he generally preferred higher interest rates as a means of ensuring low and stable inflation.

In recent months, however, Warsh has voiced support for lower interest rates, rebuking the Fed’s concern about inflation risk posed by a flurry of new tariffs issued last year.

Those remarks came before the U.S.-Israeli war with Iran, however, which sent inflation soaring last month.

The rapid acceleration of price increases could complicate interest rate policy at the Fed, which may be reluctant to lower borrowing costs as inflation climbs.

ABC News' Elizabeth Schulze, Sarah Kolinovsky and Brittany Gaddy contributed to this report.

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(NEW YORK) -- Stocks closed slightly lower and oil prices rose on Monday as tensions mounted in the Strait of Hormuz, putting pressure on the ceasefire between the U.S and Iran a day before it's set to expire.

The Dow Jones Industrial Average ticked down 4 points, or 0.01%, while the S&P 500 dipped 0.2%. The tech-heavy Nasdaq declined 0.2%.

U.S. Marines seized an Iran-flagged container ship in the Gulf of Oman on Sunday, according to CENTOM, just a day after two Indian ships came under fire in the Strait of Hormuz.

A potential second round of peace talks between the U.S. and Iran remained in doubt on Monday. Iranian Foreign Ministry spokesperson Esmaeil Baghaei said Monday that Iran has not yet made any decision regarding additional talks.

West Texas Intermediate futures, the benchmark index for U.S. oil prices, climbed more than 5% on Monday, registering at about $88 a barrel. U.S. oil prices stand about 35% higher than before the war.

The escalating tensions appeared to undo a brief thaw on Friday, when a senior Iranian official declared the strait "completely open" for tanker traffic. Within minutes, President Donald Trump celebrated the announcement as a major breakthrough.

The glimmer of relief for the critical waterway sent stock prices soaring and oil prices plummeting on Friday.

Markets have swung dramatically over the weeks following the start of the U.S.-Israel attacks on Iran on Feb. 28, as investors weathered a historic global oil shock and digested mixed signals from Trump.

Stocks have moved higher on a largely consistent basis in April, however, in response to an apparent willingness on the part of both sides to end fighting and negotiate a temporary truce.

The U.S. continues to mount a naval blockade of Iranian ports in the Strait of Hormuz, exerting pressure on Tehran by choking off a key source of revenue.

Last week, the commander of the Khatam Al-Anbiya Central Headquarters of Iran’s armed forces said the U.S. blockade of Iranian ports is a "violation of the ceasefire," in a statement published by the official Islamic Republic News Agency.

The war prompted Iran's effective closure of the Strait of Hormuz, a vital maritime trading route that facilitates the transport of about one-fifth of the global supply of oil and natural gas.

The disruption amounted to the "most severe oil supply shock in history," the International Energy Agency (IEA) said in a report last week. Oil and gasoline prices soared, prompting some economists to warn of a possible recession.

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(NEW YORK) -- Stocks closed significantly higher and oil prices plunged on Friday after a senior Iranian official declared the Strait of Hormuz "completely open" for commercial traffic for the duration of the 10-day ceasefire between Israel and Lebanon.

The Dow Jones Industrial Average closed up 869 points, or 1.7%, while the S&P 500 jumped 1.2%. The tech-heavy Nasdaq increased 1.5%.

In a post on X on Friday, Iranian Foreign Minister Seyed Abbas Araghchi said: "In line with the ceasefire in Lebanon, the passage for all commercial vessels through Strait of Hormuz is declared completely open for the remaining period of ceasefire."

President Donald Trump appeared to confirm the reopening of the strait in a message posted on social media on Friday morning.

"IRAN HAS JUST ANNOUNCED THAT THE STRAIT OF IRAN IS FULLY OPEN AND READY FOR FULL PASSAGE," Trump said.

West Texas Intermediate futures, the benchmark index for U.S. oil prices, plunged more than 10%, registering at about $84 a barrel. The reading marked the index's lowest level since mid-March.

Even so, U.S. oil prices remain more than 30% higher than pre-war levels.

The U.S.-Israeli war prompted Iran's effective closure of the strait, a critical waterway that facilitates the transport of 20 million barrels of oil per day, or about one-fifth of the global supply.

The move set off the "most severe oil supply shock in history," the International Energy Agency said in a report this week. Oil prices notched their largest one-month rise ever in March, the Paris-based group said.

Gasoline prices in the U.S. registered at $4.07 on average per gallon on Friday, standing more than 30% higher than before the war, AAA data showed.

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(NEW YORK) -- The United States continued to mount a naval blockade of Iranian ports in the Strait of Hormuz on Thursday, exerting financial pressure on Tehran while at the same time choking off a source of oil amid a historic global shortage.

The move comes as Americans grapple with a surge in gasoline prices that threatens to eat away at household budgets and slow the economy.

Gasoline prices in the U.S. registered at $4.10 on average per gallon on Wednesday, standing about 35% higher than before the war, AAA data showed.

The blockade risks higher prices at the pump since oil trades on a global market, meaning a loss of supply in the Middle East could raise prices for Americans, some analysts said.

But, they added, the strategy may hasten a resolution of the war or reassure non-Iranian tankers otherwise hesitant to travel the strait, ultimately alleviating the oil shock and pushing down gas prices.

"This is an economic game of chicken," Tyler Schipper, a professor of economics at the University of St. Thomas, told ABC News.

Ten vessels have been turned around at the Strait of Hormuz during the first 48 hours of the U.S. blockade, complying with U.S. orders, according to U.S. Central Command.

On Wednesday, the commander of the Khatam Al-Anbiya Central Headquarters of Iran’s armed forces said the U.S. blockade of Iranian ports is a "violation of the ceasefire," in a statement published by the official Islamic Republic News Agency.

The war prompted Iran's effective closure of the Strait of Hormuz, a critical waterway that facilitates the transport of 20 million barrels of oil per day, or about one-fifth of the global supply.

Iran continued to export nearly 2 million barrels of oil each day through the strait, blunting some of the supply loss, according to energy data firm Kpler.

Still, in March, oil prices notched their largest one-month gain ever, the International Energy Agency said in a new report on Tuesday.

The potential loss of Iranian oil exports amid the blockade could deepen the supply shock and raise gasoline prices further, some analysts said.

"The move toward a full blockade of the Strait of Hormuz is compounding global supply concerns and risks further disrupting flows," GasBuddy petroleum analyst Patrick De Haan said in a post on X on Monday.

Car owners, De Haan added, "should prepare for another round of price increases."

Jason Miller, a professor of supply chain management at Michigan State University, echoed such concern.

"It's unclear to me how this moves to quickly solve the problem that vessels aren't transiting the Strait of Hormuz," Miller told ABC News. "Every day this continues, it gets worse and worse and worse."

Price hikes have not come to pass over the initial days of the blockade, however.

West Texas Intermediate futures price, the benchmark index for U.S. trading, clocked in at about $92 a barrel on Wednesday, marking a nearly 10% drop since the blockade began at 10 a.m. Eastern Time on Monday.

Even so, U.S. oil prices remain about 40% higher than pre-war levels.

The national average price of a gallon of gas as of Wednesday stood 1.4% lower than a week earlier.

The ceasefire between the U.S. and Iran entered its second week, appearing to boost hopes of a resolution to the war.

President Donald Trump reiterated his desire to wind down the conflict, meanwhile, saying the war is "very close to over" in a portion of an interview with Fox News’ Maria Bartiromo that aired on Tuesday.

Rather than restrict oil supply, the U.S. blockade could ultimately add crude to the market if the naval presence reassures non-Iranian ships otherwise unwilling to sail through the strait, Dominic Pappalardo, chief multi-asset strategist at Morningstar Wealth, told ABC News.

"For countries other than Iran, does the blockade give them more trust for sending oil through the strait?" Pappalarado said. "If other countries start to gain confidence, you could see other shipments pick up for non-Iranian vessels pushing through the strait, which would help alleviate upward pressure on the price."

As of Monday, tanker traffic remained well below pre-war levels after the blockade had taken effect, Kpler said in a post on X. Six vessels sailed through the strait on Monday, Kpler said, marking a decline from 14 vessels a day prior.

The conditions in the strait remain in flux, some analysts said, leaving a wide range of possible outcomes.

"There's still tremendous uncertainty," Miller said.

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(NEW YORK) -- Live Nation illegally monopolized the market for tickets, protecting its position through pressure and leverage, jurors in Manhattan federal court found Wednesday.

This is a developing story. Check back for updates.

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(NEW YORK) -- The S&P 500 hit a record high on Wednesday as the ceasefire between the U.S. and Iran entered its second week, appearing to boost hopes of a resolution to the Middle East conflict.

The uptick in markets came hours after President Donald Trump reiterated his desire to wind down the conflict, saying the war is "very close to over" in a portion of an interview with Fox News’ Maria Bartiromo that aired on Tuesday.

The S&P 500 climbed 0.5% on Wednesday, registering at 7,005.78 points. The index reached a previous high of 7,002.28 points on Jan. 28.

The Dow Jones Industrial Average fell 125 points, or 0.2%, while the tech-heavy Nasdaq increased 1.1%.

Markets have swung dramatically over the weeks following the start of the U.S.-Israel attacks on Iran on Feb. 28, as investors weathered a historic global oil shock and digested mixed signals from Trump.

Stocks moved higher on a largely consistent basis in April, however, in response to an apparent willingness on the part of both sides to end fighting and negotiate a temporary truce.

The U.S. continues to mount a naval blockade of Iranian ports in the Strait of Hormuz, exerting pressure on Tehran by choking off a key source of revenue.

On Wednesday, the commander of the Khatam Al-Anbiya Central Headquarters of Iran’s armed forces said the U.S. blockade of Iranian ports is a "violation of the ceasefire," in a statement published by the official Islamic Republic News Agency.

The war prompted Iran's effective closure of the Strait of Hormuz, a critical waterway that facilitates the transport of about one-fifth of the global supply of oil and natural gas.

The disruption amounted to the "most severe oil supply shock in history," the International Energy Agency (IEA) said in a new report on Tuesday. Oil and gasoline prices soared, prompting some economists to warn of a possible recession.

U.S. oil prices have fallen from a recent peak achieved in the early days of the war, but costs remain nearly 40% higher than pre-war levels.

U.S.-Iran talks in Pakistan over the weekend failed to secure a peace deal. Trump said that Iran's alleged unwillingness to abandon its nuclear program was the key sticking point, and that the U.S. would respond with a blockade of the Strait of Hormuz, which began Monday.

Israel, meanwhile, has continued ground operations and intense strikes in Lebanon, where it is engaged with the Iran-backed Hezbollah militia. Israeli Prime Minister Benjamin Netanyahu said he supported the ceasefire with Iran, but that Lebanon was not covered by the agreement, despite Iranian protests.

ABC News' David Brennan, Meredith Deliso, and Nadine El-Bawab contributed to this report.

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(NEW YORK) -- Inflation surged in March after an oil shock triggered by the U.S.-Israeli war with Iran, government data showed on Friday. The inflation report matched economists' expectations.

Prices rose 3.3% in March compared to a year earlier, marking a steep rise from a year-over-year inflation rate of 2.4% in the prior month. Annual inflation jumped to its highest level in two years, U.S. Bureau of Labor Statistics (BLS) data showed.

The jump in prices owed in large part to a sharp rise in costs for products impacted by the oil shortage. Gasoline prices were 25% higher in March than February, the BLS report said. Overall, energy prices jumped almost 12% from a month earlier.

Airline fares increased 3.4% in March from February, the data showed.

The rapid acceleration of price increases could complicate interest rate policy at the Federal Reserve, which may be reluctant to lower borrowing costs as inflation climbs.

The Middle East conflict prompted Iran's effective closure of the Strait of Hormuz, a critical waterway that facilitates the transport of about one-fifth of the global supply of oil and natural gas.

That energy shortage sent oil and gasoline prices surging worldwide. Gasoline prices in the U.S. stood at $4.15 on average per gallon on Friday, marking a leap of $1.17 since the start of the war, AAA data showed.

The BLS collected price data over the entire month of March. The inflation report, in turn, reflected prices for 31 of the first 32 days of war, excluding the outbreak of hostilities on Feb. 28. The ceasefire announced on Tuesday came after 40 days of fighting.

As part of a two-week U.S.-Iran ceasefire announced on Tuesday, Iran says it will allow tankers passage through the Strait of Hormuz as long as they coordinate with the nation's military.

The resumption of tanker traffic remains uncertain, however. Tanker traffic was suspended on Wednesday after Israeli attacks on Lebanon, Iran's semi-official Fars News Agency reported.

Crude prices fell after the ceasefire announcement but remained highly elevated. U.S. oil prices topped $98 a barrel as of Thursday, standing nearly 50% higher than their pre-war level.

A surge in consumer prices could pose difficulty for the Fed as it weathers a slowdown of economic performance over recent months.

If the Fed opts to lower borrowing costs, it could spur growth but risk higher inflation. On the other hand, the choice to raise interest rates may slow price increases but raises the likelihood of a cooldown in economic performance.

Last month, Federal Reserve Chairman Jerome Powell said that despite rising energy prices and the potential impact on inflation, he doesn't think the central bank needs to raise interest rates.

Powell noted that central bankers often look past shocks -- such as sudden oil-price increases -- since the upward pressure on consumer prices usually proves temporary.

"We feel like our policy is in a good place for us to wait and see how that turns out," Powell said.

The benchmark interest rate stands at a level between 3.5% and 3.75%. That figure marks a significant drop from a recent peak attained in 2023, but borrowing costs remain well above a 0% rate established at the outset of the COVID-19 pandemic.

The Fed will announce its next rate decision on April 29. Investors overwhelmingly expect the Fed to leave rates unchanged, according to the CME FedWatch Tool, a measure of market sentiment.

The tool pegs a roughly 70% chance that the Fed will maintain interest rates at current levels for the remainder of the year.

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(NEW YORK) -- Stocks closed significantly higher on Wednesday, just hours after the U.S. and Iran announced a two-week ceasefire.

The Dow Jones Industrial average surged 1,325 points, or 2.8%, while the S&P 500 climbed 2.5%. The tech-heavy Nasdaq jumped 2.8%.

As part of the accord, Iran says it will allow tankers passage through the Strait of Hormuz, a vital shipping route for oil and gas, as long as they coordinate with the nation's military.

Investors appeared optimistic that the agreement would ease one of the worst global oil shortages in decades, though the resumption of tanker traffic in the strait remained uncertain.

U.S. oil prices plummeted nearly 15% on Wednesday, registering at about $96 a barrel. Still, the price of oil remained well above pre-war levels of about $67 a barrel.

President Donald Trump touted the ceasefire in a social media post on Wednesday, saying there would be "no enrichment of Uranium," despite the Iranians claiming that the U.S. agreed to its plan, which includes numerous concessions.

The president added that "the United States will, working with Iran, dig up and remove all of the deeply buried (B-2 Bombers) Nuclear 'Dust.'"

The Iranian Supreme National Security Council's statement on Tuesday included "acceptance of enrichment" in its 10-point plan.

Investors will likely pay close attention to a potential uptick in tanker traffic through the Strait of Hormuz.

Following Israeli attacks on Lebanon on Wednesday, oil tankers are suspended from passing through the strait, Iran's semi-official Fars News Agency reported.

Typically, scores of ships carry a fifth of the world's oil through the strait each day, but Iran effectively closed the passage over the course of the war. That oil shortage sent crude prices soaring, and it threatened far-reaching price increases that some economists feared could tip the U.S. economy into a recession.

ABC News' David Brennan, Jon Haworth and Nadine El-Bawab contributed to this report.

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(NEW YORK) -- The U.S. recorded strong job gains in March, rebounding from dismal losses a month earlier, a jobs report on Friday showed. The reading far exceeded economists' expectations.

The U.S. added 178,000 jobs in March, according to the report, which marked a sharp increase from 133,000 jobs lost in the previous month.

The unemployment rate ticked down to 4.3% in March from 4.4% in February, the Bureau of Labor Statistics (BLS) said. Unemployment remains low by historical standards.

The BLS collected survey data through the second week of March, before the full effects of the oil shock set off by the Iran war.

As in previous months, the health care sector stood out as a top source of hiring in March, adding 76,000 jobs, the BLS said. The construction sector, as well as transportation and logistics, also contributed to the surge in hiring.

Employment in the federal government continued to decline in March, shedding 18,000 jobs, the BLS said. The federal government has lost 355,000 jobs, or nearly 12% of its workforce, since October 2024, a month before President Donald Trump was elected.

The government report arrived as the war continues to drive up gasoline prices and borrowing costs, threatening a drag on the economy.

The U.S. added an average of about 15,000 jobs per month in 2025, U.S. Bureau of Labor Statistics (BLS) data showed. That performance amounted to a sharp slowdown from 186,000 jobs added each month in 2024.

The U.S.-Israeli war on Iran, which began on Feb. 28, triggered one of the worst global oil shocks in decades, prompting gloomy forecasts on Wall Street of a potential U.S. recession over the coming months.

In theory, a prolonged oil shortage could drive up prices for a vast array of goods, sapping energy from consumer spending, which powers most of the nation’s economic growth.

Iran has mounted an effective closure of the Strait of Hormuz, a critical maritime trading route that facilitates the transport of about one-fifth of the global oil supply.

The U.S. is a net exporter of petroleum, meaning the country produces more oil than it consumes. But since oil prices are set on a global market, U.S. prices move in response to swings in worldwide supply and demand.

The disruption in oil shipping has pushed U.S. crude prices above $110 a barrel, which marks a staggering rise of more than 50% since the war began on Feb. 28.

Gasoline prices in the U.S. ticked up to $4.08 on average per gallon as of Wednesday, marking a leap of $1.09 over the past month, AAA data showed.

A potential jump in costs for additional goods delivered through the Strait of Hormuz -- such as fertilizer and diesel fuel -- could also raise prices beyond gasoline, putting pressure on the Federal Reserve to hike interest rates in an effort to quell possible inflation.

The benchmark interest rate stands at a level between 3.5% and 3.75%. That figure marks a significant drop from a recent peak attained in 2023, but borrowing costs remain well above a 0% rate established at the outset of the COVID-19 pandemic.

If the Fed moved to raise interest rates, it would hike borrowing costs for many consumer and business loans, risking a slowdown in hiring.

Speaking at Harvard University on Monday, Fed Chair Jerome Powell said the central bank could take a patient approach as it monitors potential price effects from the Middle East conflict.

"We feel like our policy is in a good place for us to wait and see how that turns out," Powell said.

Editor’s note: This story has been updated to reflect the time period covered by the BLS survey.

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(NEW YORK) -- Stocks closed mixed in volatile trading on Thursday after President Donald Trump delivered a televised address vowing to hit Iran "extremely hard" over the coming weeks.

The Dow Jones Industrial Average closed down 60 points, or 0.1%, after opening down by 600 points, while the S&P 500 ticked up 0.1. The tech-heavy Nasdaq increased 0.1%.

Each of the major indexes tumbled more than 1% in early trading, but they quickly recovered most or all of those losses.

The rollercoaster trading followed losses across Asian and European markets. Tokyo's Nikkei 225 index slipped 2.3% and the pan-European STOXX 600 fell 0.6%.

Oil prices, meanwhile, surged as traders feared a persistent supply shortage amid the ongoing U.S.-Israeli war with Iran. U.S. oil prices climbed more than 10% on Thursday, registering about $111 a barrel.

Gasoline prices in the U.S. ticked up to $4.08 on average per gallon, marking a leap of $1.09 over the past month, AAA data showed.

Speaking at the White House on Wednesday, Trump voiced mixed messages about his plans for the Middle East conflict. He said Iran is no longer a threat to the U.S. and the war in Iran is "nearing completion." However, he added, the U.S. plans to continue striking Iran over the next two or three weeks.

"We're going to bring them back to the stone ages where they belong," Trump said.

The trading volatility on Thursday interrupted an upswing for markets earlier in the week. On Tuesday, the Dow Jones Industrial Average soared more than 1,100 points, adding another 220 points on Wednesday as traders anticipated Trump may signal an off-ramp from the war in his evening remarks.

Since the war with Iran began on Feb. 28, Trump has issued conflicting signals about the expected duration of the war. On several occasions, stocks have climbed or fallen as markets weighed the implications of Trump's comments.

The war prompted Iran's effective closure of the Strait of Hormuz, a maritime trading route that facilitates the transport of about one-fifth of the global oil supply.

The vast majority of fuel delivered through the strait is bound for Asia, placing the heaviest pressure on energy supply in that continent. Since oil and gas are sold on a global market, however, the shortage has sent prices rising for just about everyone.

On Wednesday night, Trump urged other countries to take responsibility for reopening the strait.

"The countries of the world that do receive oil through the Hormuz Straight must take care of that passage," Trump said. "We will be helpful, but they should take the lead in protecting the oil that they so desperately depend on."

A potential U.S. exit from the war without ensuring that the strait is open could cast uncertainty over the path to a resumption of normal tanker traffic and a remedy for the current global oil shortage.

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(WASHINGTON) -- President Donald Trump on Thursday slapped 100% tariffs on some pharmaceutical products, ramping up his effort to boost U.S. drug manufacturing.

The move, in the form of an executive order, targets patented drugs that lack a "most favored nations" pricing agreement with the U.S. Under such agreements, companies ensure the U.S. will pay the same amount that other wealthy countries pay for similar medications.

Companies face a reduced levy if they agree to bring production to the U.S. or enter into pricing deals with the administration, the executive order says. 

If companies commit to bring their manufacturing to America, then the tariff on their products will drop to 20%, the order notes.

In the event such companies also enter into a most-favored-nation agreement with the Department of Health and Human Services, then they can avert tariffs entirely while in the process of building a U.S.-based plant, according to the executive order.

Large companies, the executive order says, will receive a 120-day phase-in period before the tariffs take effect.

The fresh round of tariffs will exclude drugs made in some countries that previously entered into trade agreements with the U.S., including Switzerland, Japan, South Korea and the 27-member European Union, according to the order.

Pharmaceutical products from those countries will face a 15% tariff based on the terms of trade agreements reached with the U.S, the order notes.

This is a developing story. Please check back for updates.

ABC News' Mary Kekatos contributed to this report.

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(NEW YORK) -- Mortgage rates have climbed to their highest level since September as fallout from the Iran war ripples through financial markets, Freddie Mac data on Thursday showed.

The average interest rate for a 30-year fixed-rate mortgage jumped to 6.46%, continuing a weeks-long surge since the war began on Feb. 28, during which time mortgage rates have increased nearly half a percentage point.

Mortgage rates remain slightly lower than this time a year ago, when the average rate for a 30-year fixed mortgage stood at 6.64%.

The recent spike in borrowing costs risks further strain on U.S. households as they weather elevated gasoline prices.

The rise in mortgage rates owes to a jump in U.S. Treasury yields as investors fear a bout of inflation in response to the Middle East conflict.

High bond yields make borrowing more expensive for average Americans, since 10-year Treasury rates influence the rates offered for a variety of loans, including mortgages and credit cards.

Since bonds pay a given investor a fixed amount each year, the specter of inflation risks higher consumer prices that would eat away at those annual payouts. In turn, bonds often become less attractive in response to economic turmoil. When demand falls, bond yields rise.

The yield on a 10-year Treasury bond, meaning the amount paid to a bondholder annually, stands at about 4.31%, about 0.35 percentage points higher than pre-war levels.

"Mortgage rates have risen as bond market yields have sought to price in the risk of higher inflation in the future," Mark Hamrick, senior economic analyst at Bankrate, previously told ABC News.

Last week, bond yields soared close to levels reached in the aftermath of President Donald Trump’s “Liberation Day” tariffs in April 2025, when the 10-year Treasury yield peaked at around 4.5%.

Bond yields eased in recent days as Trump signaled a possible off-ramp from the war with Iran.

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(NEW YORK) -- The Dow Jones Industrial Average soared more than 950 points on Tuesday after President Donald Trump appeared to suggest the U.S. may end the Iran war without reopening the Strait of Hormuz.

In a post on social media, Trump indicated that the task of reopening the strait may fall to other countries, urging them to "go to the Strait, and just TAKE IT."

The Dow jumped 970 points, or 2.1%, by early afternoon, while the S&P 500 climbed 2.4%. The tech-heavy Nasdaq increased 3.4%.

Since the U.S.-Israeli war with Iran began on Feb. 28, Trump has voiced mixed messages about the expected duration of the war. On several occasions, markets have climbed after traders interpreted comments from Trump as a potential off-ramp from the Middle East conflict.

The war prompted Iranian closure of the strait, a maritime trading route that facilitates the transport of about one-fifth of the global oil supply. A potential U.S. exit from the war without ensuring that the strait is open could leave uncertain the path to a resumption of normal tanker traffic and a resulting remedy for the current global oil shortage.

Global oil prices surged more than 5% on Tuesday, exceeding $118 a barrel, just shy of its highest price since 2022.

Gas prices in the United States topped $4 per gallon on average Tuesday, underscoring the link between rising oil prices and strained consumers.

This is a developing story. Please check back for updates.

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(NEW YORK) -- Gas prices in the United States topped $4 per gallon on average Tuesday, crossing the milestone for the first time in nearly four years, just weeks after the U.S.-Israeli war on Iran set off a global oil shock and spiked fuel costs.

Prices at the pump have soared more than 30% since the war began on Feb. 28., AAA data showed. Fuel costs last exceeded $4 a gallon in August 2022 following the Russian invasion of Ukraine.

The Middle East conflict prompted Iranian closure of the Strait of Hormuz, a maritime trading route that facilitates the transport of about one-fifth of global oil supply. The risk of a prolonged oil shortage triggered a surge in crude prices.

The U.S. is a net exporter of petroleum, meaning the country produces more oil than it consumes. But since oil prices are set on a global market, U.S. prices move in response to swings in worldwide supply and demand.

Global oil prices hovered around $104 a barrel on Tuesday, which amounted to a nearly 50% price leap from pre-war levels.

Crude oil is the main ingredient in auto fuel, accounting for more than half of the price paid at the pump, according to the federal U.S. Energy Information Administration.

Fatih Birol, the executive director of the International Energy Agency (IEA), earlier this week said the current oil crisis had surpassed the combined effect of worldwide energy shocks in the 1970s.

The global economy faces a "major, major threat," Birol said at an event in Canberra, Australia, noting that no country would be "immune to the effects of this crisis if it continues to go in this direction."

Member nations of the IEA announced two weeks ago that they plan to release 400 million barrels of oil from its strategic reserve, marking the largest oil release in the 32-nation group's history.

The Trump administration is set to carry out the second-largest-ever delivery from the nation's emergency reserve, which will make up nearly half of the IEA's planned release. Trump also eased sanctions on Russian oil and suspended a key regulation of domestic oil transport. The president has also sought to restore tanker traffic in the Strait of Hormuz.

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