The Strait of Hormuz carries about one-fifth of the world’s petroleum (Image from 2021)
Global gas prices have surged as the escalating Middle East conflict threatens shipments through the Strait of Hormuz, a critical corridor that carries about 20% of global LNG trade.
For the first time since 2024, Brent crude surpassed $85 a barrel, and diesel futures recorded their biggest daily spike since the first Gulf War.
Concerns mounted after Iran’s Revolutionary Guards declared the Strait of Hormuz closed to shipping and warned of attacks on vessels, while President Donald Trump said the conflict may last over four weeks.
The Strait carries about one-fifth of the world’s petroleum.
Trump said the US would provide political insurance and, if needed, escort tankers through the Strait of Hormuz, a move that helped calm markets after an earlier downturn.
Iraq, OPEC’s second-biggest producer, moved to scale back operations at major oil fields and is preparing additional cuts.
What it means for oil prices?
US gas averaged $3.11 a gallon yesterday, up 11 cents from Monday, according to AAA. Analysts warn oil could hit $100 a barrel, potentially pushing gas toward $4 a gallon.