U.S. crude oil prices surged above $90 per barrel on Friday, marking the highest level in over two years. West Texas Intermediate (WTI) crude, the primary oil price benchmark in North America, closed the day slightly above $91, a notable increase from approximately $67 just a week earlier. The escalation in tensions following the initiation of a new conflict involving the U.S. and Israel against Iran and its affiliations has contributed to this price surge.
The intensifying conflict in Iran and the looming threat of potential drone or missile attacks from Iran have led to a significant disruption in tanker traffic through the crucial Strait of Hormuz. This strategic sea passage, serving as the primary exit point from the Persian Gulf and facilitating 20% of the global oil supply, has witnessed a near-complete halt in tanker movements. The vessels navigating through the strait, bordered by Iran to the north, transport oil and natural gas from countries such as Saudi Arabia, Kuwait, Iraq, Qatar, Bahrain, the United Arab Emirates, and Iran.
U.S. Energy Secretary Chris Wright, speaking on Fox News, anticipates that the current surge in oil prices may endure for “weeks, not months.” The ongoing conflict with Iran, which has historically played a role in escalating energy prices over nearly five decades, aims to curtail Iran’s disruptive activities and ensure regional stability.
In response to the escalating oil prices, gasoline prices in the United States have risen by an average of 34 cents per gallon in the past week, reaching $3.32 per gallon or approximately 120 cents per liter. Following the recent airstrikes, Canadian gas prices surged to 135.3 cents per liter, as reported by Gasbuddy.com, compared to the average of 128.8 cents a month earlier. Gas wizard, a platform monitoring gas prices nationwide, projects that the price per liter could climb to nearly 153 cents on Saturday.