With the U.S. and Iran exchanging strikes once again — and the return of normal traffic flows in the Strait of Hormuz in doubt — traders on prediction market platform Kalshi think gas prices will likely still be elevated for longer now.

Speculators think there's a 75% chance that gas prices on Election Day, Nov. 3, will be above $3.50 per gallon, and place 39% odds that prices will be above $3.75. Before the recent developments in the Middle East, those odds were as low as 37% and 22%, respectively.

The contract is resolved using data from AAA's national average of gas prices.

On Thursday, the national average of gas prices was at $3.84, according to AAA, up 5 cents from the day prior. The rise comes as U.S. oil prices rose as high as $75 per barrel on Wednesday, up from around $68 per barrel on Monday. However, WTI crude eased to below $72 per barrel on Thursday.

While traders on Kalshi think gas prices will remain higher for longer, they also don't see them returning to new highs. They give just a 43% chance gas prices cross $4.60 this year, although that's up from about a one-in-three chance before renewed hostilities between the U.S. and Iran.

The high for gas prices in 2026 was on May 21, when the average hit $4.56. Before the war with Iran began, the national average for U.S. gas prices was below $3 per gallon.

Disclosure: CNBC and Kalshi have a commercial relationship that includes customer acquisition and a minority investment.