NEW YORK — Trump officials say Iran is miscalculating if it believes rising prices and the midterm elections will weaken President Donald Trump's hand in negotiations to end the nearly seven-month conflict.

The administration is projecting confidence that mounting economic pressure will push Tehran toward a deal, even after three hours of talks this week ended without an announced breakthrough. "The president holds all of the cards here," State Department principal deputy spokesperson Tommy Pigott told Fox News Digital in an on-camera interview on the sidelines of the U.N. General Assembly.

Americans, meanwhile, are facing a mounting cost at home. The national average for regular gasoline reached $4.49 per gallon Friday, according to AAA, up from $3.16 a year ago. AAA said volatility in the Strait of Hormuz and high crude oil prices have driven the national average to its highest level ever recorded for this time of year.

Secretary of State Marco Rubio acknowledged those costs Wednesday while arguing that allowing Iran to eventually obtain a nuclear weapon would carry a far greater price.

THE TOP MOMENTS FROM IRAN PRESIDENT’S TENSE VISIT TO US SOIL AS WAR RAGES "It comes at a price and at a cost, there's no doubt about it," Rubio told reporters. "But the cost of not doing something about it is substantially higher, especially for future generations." Trump himself laid out the stakes in stark terms during his address to the U.N. General Assembly Tuesday, presenting Tehran with a choice between reaching a deal that would allow Iran to rebuild or facing potentially devastating further U.S. action.

THE TOP MOMENTS FROM IRAN PRESIDENT’S TENSE VISIT TO US SOIL AS WAR RAGES "It comes at a price and at a cost, there's no doubt about it," Rubio told reporters. "But the cost of not doing something about it is substantially higher, especially for future generations." Trump himself laid out the stakes in stark terms during his address to the U.N. General Assembly Tuesday, presenting Tehran with a choice between reaching a deal that would allow Iran to rebuild or facing potentially devastating further U.S. action. "Or do I annihilate the Islamic Republic and do it quickly, never giving them a chance to kill and destroy people and countries again?" Trump said. "Do I drive them into hell with no chance of survival and no hope of future greatness or generations?" But Trump predicted Tehran would ultimately choose a deal, arguing that Iranian leaders are waiting to see whether the November midterm elections weaken his position. "They're waiting to see how I do in the midterm election," Trump said. "What they don't realize is that I'm not running." "I gave absolutely no credence and will not give credence to the election when it comes to Iran," Trump added. "It doesn't even enter my mind." A U.S. official told Fox News Digital Friday that discussions through mediators remained "positive and constructive," but said the administration was in no hurry to reach an agreement. "The United States is in a very strong position with control of the Strait of Hormuz, so we are not in a rush," the official said, adding that nearly 40 million barrels of oil had transited the strait over the previous 48 hours. The official predicted oil and gas prices would fall back to pre-conflict levels as the U.S. continues to maintain control of the strait.

Trump said U.S. officials held a "very good" three-hour meeting with Iranian officials Tuesday as part of a renewed diplomatic push to end the conflict. But Rubio cautioned Wednesday against characterizing the talks as a "major breakthrough," saying they were largely a continuation of previous conversations. "I think it was significant that at least there was a conversation," Rubio said.

Rubio also said the administration would make public any "good outcomes or things to announce jointly" stemming from its diplomatic engagements. No such announcement immediately followed the Iran meeting.

Iran has since put forward a proposal of its own. Iranian Foreign Minister Abbas Araghchi said Tehran presented U.S. mediators with a seven-day plan this week that would restore passage through the Strait of Hormuz at the end of the seven days if certain conditions are met, followed by renewed negotiations toward a broader agreement.

The proposal draws from the memorandum of understanding Trump and Iran reached in June. A mediator told CBS News the latest discussions were positive but remained in their early stages.

The stakes in Hormuz remain high. Commercial traffic through the critical oil chokepoint has been sharply disrupted during the conflict, although U.S. officials say the amount of oil moving through the strait is increasing.

TRUMP BETS ECONOMIC PRESSURE CAN SQUEEZE IRAN AS REGIME’S OWN FAILURES DEEPEN THE PAIN "The diplomatic door is always open. The president is a deal maker," Pigott said. "But he's going to see the fundamental principle that they cannot have a nuclear weapon accomplished one way or another." Pigott pointed to growing oil flows through the Strait of Hormuz and the economic pressure Washington has imposed on Tehran as evidence that the balance remains in Trump's favor.

"We are seeing oil move [through] the Strait of Hormuz, increasing every single day," Pigott said. "We're seeing the devastating effects on the Iranian regime from economic [actions]. Hundreds of millions of dollars are being denied to the regime through this blockade that we're seeing." Rubio offered a similar assessment Wednesday when asked about Trump's assertion that Iran may be waiting for the outcome of the midterm elections before making a deal.

"I think the Iranians misread our system," Rubio said. "I think the Iranians are under this illusion that Democrats are going to win in November, and the president will no longer be able to do things against them." Rubio said Congress remains an important branch of government but argued Tehran misunderstands the limits of congressional power over sanctions and military action.

"The president has extraordinary powers. Every president does," Rubio said. "He's the commander in chief, both constitutional and otherwise, to be able to carry out those functions." "So I think that the Iranians are fundamentally misreading our political system," Rubio continued.

The administration is also confronting threats to energy infrastructure elsewhere in the region. Iran-backed Houthi rebels have targeted Saudi Arabia as the conflict has expanded, adding another source of uncertainty for global energy markets.

Rubio said Wednesday that the restart of a Saudi pipeline following attacks was "critical for their economy" and "critical for the global economy." He said energy infrastructure had been targeted by the Houthis as well as Shiite militias in Iraq that the U.S. says are backed by Iran.

"Every time you guys ask me a question about the Middle East, it goes back to someone who's supported by Iran," Rubio said.

Rubio said the U.S. would continue honoring its defense commitments to Saudi Arabia while declining to discuss what additional military options Trump could consider.

"They are a strategic defense partner," Rubio said. "The U.S. made commitments to them. We will live up to those commitments. We are living up to those commitments now."