Strikes on Iran could push US gas prices well above $3, analysts warn
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Analysts say U.S. gas prices could surge past $3 a gallon if strikes on Iran disrupt global oil supplies, especially through the Strait of Hormuz.
Oil markets currently closed for the weekend are set to see price swings next week as the impact from the U.S. and Israeli strikes on oil supplies from the Middle East remains unclear.
Scenarios before the latest conflict with Iran foresaw a quick price spike that fades if the attacks didn't affect oil shipping and infrastructure such as Iranian pipelines and its Kharg island terminal. However, there would be a bigger price spike and longer-lasting impact if oil infrastructure or supplies were interrupted, for instance because of disruption of tanker traffic through the Strait of Hormuz.
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Oil prices have already risen on war fears. International benchmark Brent crude closed at a seven-month high of $72.87 on Friday.
Iran exports some 1.6 million barrels of oil a day, most of it going to China, where privately owned refineries are less concerned about the U.S. sanctions that prevent Iran from selling its oil elsewhere. If that supply is disrupted, Chinese customers would look elsewhere for oil on the global market, potentially driving up prices.
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