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Global uncertainty sparked by Operation Epic Fury has resulted in a potential spike in gas and oil prices.
A report by The Hill indicates that Americans could see a reaction to the joint U.S.-Israeli strikes on Iran at the pump.
“The price of global benchmark Brent Crude oil was at about $77 per barrel as of Monday afternoon, up from about $71 a week ago and about $66 per barrel a month ago,” the outlet reports. “U.S. gasoline prices were also up Monday following the weekend’s strikes, averaging about $3 per gallon nationwide, up 6 cents from a week ago and 12 cents from a month ago.”
Ongoing turmoil in the Middle East could also push prices higher, and head of petroleum analysis at GasBuddy, Patrick De Haan, believes they will rise “between 10 and 15 cents over the course of the next week or two,” according to the report.
“By the time prices peak, they could be 25 to 40 cents higher than today,” he said.
Similarly, Gulf Oil’s chief oil analyst Tom Kloza suggested that prices could peak anywhere between $3.25 and $3.50/gal. This spring, marking a stark rise from their current state. Diesel prices are predicted to have an even more significant rise, with Kloza stating they “could soon be on par with where they were in 2022 after oil and oil product costs jumped in the wake of Russia’s invasion of Ukraine,” per The Hill‘s reporting.
“Diesel prices are … probably going to be back around $4 or higher here in the second quarter. Those are stunning highs, comparable to what we saw in 2022,” he stated.
“Gasoline prices are going to go up, but diesel prices are going to go up far more noticeably,” De Haan agreed. “Inflation numbers are going to start heating up a bit if diesel is continuing to rally.”
Kloza claims that Trump’s warning of an impending “big wave” in Iran could be causing some hesitation on the part of oil sellers, which is going to have an impact on gas prices for everyone.
“Right now, with quotes like that, you’re just not going to have anybody willing to sell into the marketplace. I think they probably would be smart if they did, but it’s just too risky,” he theorized.
De Haan pointed out that the Strait of Hormuz could also be playing a part in the current oil market.
“Should you travel the Strait of Hormuz, there’s a lot of risk right now in doing so. You don’t want to be targeted by Iran. Shippers may be seeing a very high jump on the price of insurance that they have to carry — just a lot of challenges,” he said. “It’s probably just a bit easier instead of navigating those challenges to just hold on for the time being.”
But it’s not all bad news, as Kloza predicts prices will drop come November, just in time for the midterm elections.
“Those within the administration, I think they believe that they can get a handle on this, and they can, they can restore reasonable flows in time for the midterms.”
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