United States: Walmart has warned that rising petrol prices, fuelled by ongoing geopolitical tensions linked to the Iran–Middle East conflict, are putting fresh pressure on US consumers and slowing spending across key retail categories.
The company expects sales growth to ease significantly in the May–July quarter compared with the previous three months, as higher fuel costs reduce discretionary spending power. Data from the American Automobile Association shows average petrol prices have surged to $4.56 per gallon, up sharply from around $3 when the conflict escalated.
Fuel shock hits household budgets
Walmart’s finance chief John David Rainey told that earlier relief from higher tax refunds had helped soften the blow of rising living costs. However, David Rainey warned that this support is now fading, leaving consumers more exposed to higher petrol prices.
David Rainey said shoppers are beginning to feel more of that pressure as fuel costs remain elevated, with the retailer closely monitoring price movements across energy markets.
The company also signalled that sustained disruption to global oil flows, particularly through the Strait of Hormuz, could further escalate costs across supply chains, including food production inputs such as fertiliser, nitrogen, and phosphates.
Despite the warning, Walmart reported strong first-quarter performance, with profits rising to $5.3 billion and sales up 7.3 percent year-on-year to $177.8 billion. However, the retailer forecast slower growth of 4 percnt to 5 perent in the current quarter, signalling a cooling in consumer demand. Following the outlook revision, Walmart shares fell around 7 percent in early trading.
Wider economic pressure builds
The developments come as the broader economic impact of the ongoing Middle East conflict involving Iran continues to ripple through global energy markets, pushing up fuel costs in the United States. Analysts say the retail warning reflects growing pressure on household budgets, with inflation in transport costs expected to weigh on spending in the months ahead.
The situation has also been linked to broader fiscal dynamics, including tax relief measures under the One Big Beautiful Bill Act, which previously helped offset rising living costs but is now seen as having a diminishing effect.
Market outlook
Analysts warn that if fuel prices remain elevated, US retailers may face a more pronounced slowdown in demand, particularly in non-essential categories. Walmart’s guidance is being viewed as an early signal of how sustained energy shocks could reshape consumer behaviour in the second half of the year.
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