By Genna Contino, Andrew Keshner and Venessa Wong
'The rise in gas prices is basically free advertisement for EV adoption'
The cost of a gallon of gas has soared past $4.40 - but these EV drivers are unbothered.
When Matthew Fuller needed a new car in February, he started by looking around for cheap beaters.
The college student, who works part time at Starbucks (SBUX), had a budget of just $5,000, and he knew from previously owning a Nissan (JP:7201) (NSANY) Sentra that pricey maintenance on gas-powered vehicles can pile up fast. So he eventually pivoted to shop for used electric vehicles.
Fuller ended up finding a 2018 Nissan Leaf for $6,500. Even though it was over his budget, he decided to buy the EV since he had built up a considerable emergency fund over the years.
Now, as average gas prices sit around $4.30 a gallon in Florida, Fuller couldn't be happier with his purchase. Charging costs him about $43 a month to drive 1,000 miles, which is significantly lower than the roughly $164 he would be paying monthly to fuel his old Sentra today.
&#34;As a broke college kid with two low-income parents, scraping by on entry-level paychecks and financial aid, I feel I'm already well on the way to breaking even on my EV purchase versus a comparable [internal combustion engine] vehicle,&#34; Fuller said.
EV drivers like Fuller are taking a victory lap as the war in Iran has slowed global oil supplies, pushing average U.S. gas prices past $4.40 a gallon as of Friday. Drivers of gas-powered vehicles in states like California - which gas prices have passed the $6 mark - are feeling even more pain at the pump.
Matthew Fuller standing with his Nissan Leaf that he bought in February.
Read more: The U.S. produces the most oil in the world. So why are gasoline prices so high?
EV owners who got pushback from family and friends before buying their electric vehicle told MarketWatch that skyrocketing gas prices are giving them a sense of validation.
&#34;I still get questioned by family,&#34; said Nathan Lee, a recruitment-firm manager in the Dallas area who bought his first EV in August. &#34;My brother told me just today that he trusts gas more than batteries. I trust my wallet.&#34;
When James Hale first used the federal EV tax credit to help subsidize a Tesla (TSLA) in 2023, he got some heat from golf buddies who said his electric bill would increase. But the human-resources manager who lives near Kansas City, Mo., said his savings on gas more than make up for increases to his power bill.
Looking to get an EV? How to avoid making a huge financial mistake.
Today, Hale has a Rivian (RIVN) R1T truck that costs about $20 a month to charge if he drives 1,000 miles. The same distance in his old gas-powered Honda (HMC) (JP:7267) Ridgeline truck cost him about $160 a month.
EV sales have taken off since the U.S. and Israel's war with Iran started in late February, according to Cox Automotive, the parent company of brands including Kelley Blue Book. In March, new-EV sales jumped 20% from February, while used-EV sales soared 54% month over month. While new-EV sales were still down year over year, they were higher from last year for used EVs, according to Cox.
The March sales increase happened even without the benefit of the generous federal tax break that had lured EV buyers in the past. Until last September, car buyers could claim a $7,500 tax credit for eligible new EVs, while used-EV buyers could claim a $4,000 tax credit.
The tax credits were supposed to run through 2032 under a Biden-era law, but last summer's massive Republican tax law cut that short. Some people rushed to buy an EV before the tax credit expired.
There's evidence that Americans are now getting more curious about EVs. Plug In America, a nonprofit promoting EV adoption, runs an EV support center where people can ask questions about the vehicles. There was an upswing in inquiries in March, said Ingrid Malmgren, the organization's senior policy director.
&#34;Three times as many people are reaching out with questions about purchasing new and used EVs, available incentives and charging than during the previous two months,&#34; Malmgren said. &#34;This growing interest may be due to higher gas prices.&#34;
Javier Labrin said he's seeing this trend play out at his EV-charger installation company, Go Electric Chargers. Before 2026, most of the EV owners installing chargers at their homes were doing it for environmental reasons or because they were into the tech. Now, he said he's seeing people who might have been on the fence about buying an EV make the switch because of gas prices.
&#34;The rise in gas prices is just basically free advertisement for EV adoption,&#34; Labrin said.
Dozens of drivers who switched to EVs told MarketWatch that they're seeing real savings. Still, those savings amid today's high gas prices do not necessarily mean an EV is a lower-cost purchase in the long run. The average transaction price for a new electric car was $56,170 in March - $11,000 more than the average $45,092 price for new cars that aren't electric powered. Even used EVs are selling for an average price of $31,817, which is about $6,000 more than the $25,839 average for all used cars.
Read more: Here's how much Tesla paid Elon Musk last year
The typical fuel savings, by comparison, are much less. In a recent Kelley Blue Book analysis, someone driving the national average of 1,015 miles per month who needs to refuel about three times each month at $4.09 per gallon would spend about $147.24 for gas, while an EV owner charging at home would pay $59.66 at the average electricity cost of 17.65 cents per kWh.
Using these figures, charging an EV saves about $88 per month compared to buying gas, or $1,050 per year. Given the higher prices for electric vehicles, it would take years for the average EV owner to break even based on fuel savings alone.
Nathan Lee stands with his Tesla Model 3 that he purchased in August.
MarketWatch talked to multiple EV owners about how much they're saving on gas. Lee, who bought his first EV in August, said he and his wife are saving $200 each month that would go toward fuel if they still had a gas-powered car. Lauren Ghazikhanian, a nonprofit communications director from California, said she's saving about $170 a month in fuel costs after switching to an EV.
Some EV drivers can charge their cars for free through deals offered by local power companies - but those who do have to pay for charging have been impacted by rising energy costs across the country. Electric bills jumped 14% year over year this past winter, according to the National Energy Assistance Directors Association, and the cost of summer cooling is expected to push electricity costs up another 8.5%.
Alex Fiehl standing beside a Kia EV.
Alex Fiehl, an IT professional in upstate New York, said his EV-charging expenses have been impacted by electricity costs spiking over the past few winters. His utility company offers half-priced charging overnight, and it costs about $10 to $15 to fully charge his Tesla - still much cheaper than filling up a gas tank, but considerably pricier than the $2 to $3 he paid to charge in 2019 when he bought his first EV.
Read more: Inflation rate leaps to nearly 3-year high after Iran war. The Fed's hands are now tied.
EV drivers aren't entirely immune from swinging gas prices, either. Climbing gas costs translate to higher prices for other goods as manufacturers price in the increased cost of transportation. A measure of inflation used by the Federal Reserve to set interest rates jumped from 2.8% to 3.5% in March, its highest level since spring 2023, with high gas prices mostly to blame.
While some EV drivers say they're enjoying this &#34;told-you-so&#34; moment, others say they haven't even noticed the change in gas prices unless they've seen it in the news.
&#34;Of course, when someone has been saying for decades that getting off oil would be a good idea, that person is going to feel a little validation from seeing increased EV interest,&#34; said Jamie Dow, an early EV adopter who writes for the trade publication Electrek.
&#34;But overall, the change in gas prices just doesn't affect me at all,&#34; Dow said. &#34;I just plug in the same way I always have. I have spent zero seconds modifying my behavior as a result of this war.&#34;
Join MarketWatch for a live talk about teen investing on Wednesday, May 6 at 1:30 p.m. Eastern time. Sign up and submit your questions for the Q&amp;A here.
-Genna Contino -Andrew Keshner -Venessa Wong
This content was created by MarketWatch, which is operated by Dow Jones &amp; Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
05-02-26 0900ET

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The rise in gas prices, now averaging over $4.40 per gallon, is driving increased interest in electric vehicles (EVs). College student Matthew Fuller switched to a used Nissan Leaf, saving significantly on fuel costs compared to his previous gas-powered car. EV sales surged in March, with new sales up 20% and used sales up 54% from February, despite the expiration of federal tax credits. Many potential buyers are now exploring EV options due to high gas prices, leading to a notable increase in inquiries about EVs and charging solutions.

- Rising gas prices, exceeding $4.40 per gallon, are driving more consumers to consider electric vehicles (EVs) as a cost-saving alternative.  
- Sales of new EVs surged 20% and used EVs increased by 54% from February to March, indicating a growing interest despite the lack of tax incentives previously offered.  
- While some EV owners report significant savings on fuel, the higher upfront costs of EVs mean it may take years to break even compared to gas-powered vehicles.

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EV drivers are taking a victory lap - right past the gas stations selling $4-a-gallon fuel