Gas Spending Jumps 16 Pct for BofA Customers Amid Iran War

Bank of America Corp. saw its customers’ spending on gas soar 16% in March as the war in Iran led to a jump in oil prices.

For the quarter, spending on gas was up 3%, according to a presentation on the company’s website. BofA offered the breakdown as investors grow increasingly concerned that as consumers spend more on gas, they’ll pull back on discretionary items such as entertainment, travel and retail.

Those latter categories all grew at healthy levels in the first quarter for BofA customers, with entertainment outlays up 12%. For now, gas spending hasn’t changed the underlying strength consumers are exhibiting, BofA Chief Financial Officer Alastair Borthwick said Wednesday on a conference call with reporters.

If the war in Iran drags on, elevated gas prices are likely to continue to weigh on consumers’ budgets. BofA joined firms including Chime Financial Inc. in disclosing gas-cost impacts on their customers, with Chime Chief Executive Officer Chris Britt saying earlier this month that his firm’s clients spent 25% more on fuel in March compared with the previous month.

“That is definitely something consumers are feeling a real pinch in,” he said.

Retail gasoline and diesel prices in the US are at their highest seasonal levels ever, with gasoline averaging $4.12 a gallon on Monday, according to the American Automobile Association. That’s a record for the date, up from the previous high of $4.07 on the same day in 2022, following a price spike driven by Russia’s invasion of Ukraine.

Other consumer-finance companies, including Ally Financial Inc., Capital One Financial Corp. and American Express Co., are scheduled to report results this week and next, with more information about the impact on spending from higher gas prices likely to be disclosed.