Following Trump’s bigly speech on the Iran war, oil prices began rising as he spoke, and soared to $113 a barrel on Thursday morning.
Trump said the war would end “shortly,” but said Iran would continue to be hit “extremely hard” for another 2-3 weeks.
— flatten the curve anyone?
Trump also put forward no path to end the war nor to reopen the Strait of Hormuz where 20% of the world’s oil supply travels, but insisted, “The strait will open up naturally.”
— the war will magically disappear by Easter anyone?
Consequently, U.S. crude oil surged 12% to more than $113 per barrel.
On Thursday, the national average price per gallon of unleaded gas hit $4.08, up from $2.98 before the war.
If the war lasts through June, oil prices would likely spike above $200 a barrel “for a time,” according to research published recently by Australian investment bank Macquarie Group.
A global oil and gas strategist at Macquarie said on Wednesday there was a roughly 20% chance of that happening, adding $200 barrels of oil would be possible if the war ends but the strait remains mostly closed.
If oil reaches $200, this would translate to gas prices of roughly $7 a gallon in the US, shattering the prior record of $5.02 set in June 2022.