Iran's Defiance Against Increased Sanctions

Oil sales to Britain and France are stopped, sending gas prices up.
1:27 | 02/18/12

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Transcript for Iran's Defiance Against Increased Sanctions
-- the ripple effect already playing out coast to coast this evening. With gas prices and tonight a new concern it could make it worse Iran has -- cut off oil to Britain and France halting exports -- a high stakes game of brinksmanship. It comes as here at home the average gas price already spiked in their two cents just overnight and look at this over the past month gas soaring eighteen cents a gallon. In Southern California it's already topping the four dollar mark and ABC Cecilia Vega is on this story again tonight. Across America tonight gas prices were already on the rise when that bold headline came out of Iran. That it is halting oil shipments to Britain and France today eight preemptive strike by around for the European Union's tough new sanctions. Instead Iran answered with six no more oil. Here at home it all adds up to more expensive gas. Things will only get worse in the future a lot of desperate will be tied to the economy continues of these improvements gasoline prices will likely remain at elevated levels. Gas hit its highest price ever for President's Day weekend and there are predictions the national average could reach a record for 25 by late April and nearly five dollars by Memorial Day. 1007. Economists say look at it this way for every ten dollars the typical household earned last year. Nearly a whole dollar went to gas. And now with these sky high prices drivers know firsthand how quickly that adds up. Houston does your photos from around the country to show us just how expensive it is 345 in Caroline Texas 350 in Memphis. Lewis. 385. And 415 in San Carlos California. You go -- less. Go outlets to dinner. You cut your budget in in other ways you can afford to travel someplace. Does affect. The whole budget you have to maintain diplomacy he for the day and oh where you go. And here Los Angeles prices are already on the rise if anyone needed any proof that what's happening overseas is affecting the prices here at home. Just take a look at this David. The -- -- thank you and of course the markets are watching gas prices very closely as the -- now closes in on the thirteen thousand mark. It could come as early as this week on that rocket -- -- started -- good news for Americans hoping their retirement savings will continue to recover. I want to bring in -- Angela Reagan who covers the market -- -- -- as always great to have you on the broadcast and we were both talking about -- number where it ended in the last week closing at. 121949. They're so close to thirteen thousand when we get there and is this more than a psychological mark. As the -- it's much more than just a psychological point if you take a look what the market's been doing over the past month and a half since the beginning of the year actually up 6% for the Dow that really has a lot of people hopeful that we could hit thirteen thousand the next few days. Few things to watch out for this week obviously gas prices Cecilia was noting also vote in Europe for another round of bailout money for Greece there is some optimism that they -- get approval for that and the third thing to watch as more US consumer behavior are -- -- Americans go out. And by more consecutively -- big retailers -- reports coming up from the retailers this week if you went up but in the meantime up at 6% and we did the math here. It's really tangible difference in your 41 K that's right -- this leads to more consumer confidence if you look at the average 401K -- around -- 107000. Dollars just since the start of the year. Americans have seen roughly -- 6400 dollar increase a little bit more than that. That means that people feel better about how much buddy they have saved up in that inspires them to go out and spend more money on big ticket items.

This transcript has been automatically generated and may not be 100% accurate.

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