Oil prices are surging again because the market is still nervous about supply moving through the Strait of Hormuz, even after prices dropped earlier this morning.
The route is too important to ignore. Before the war, about 20% of global petroleum consumption was exported through that narrow waterway. Now traffic there has been badly disrupted as shippers fear attacks by Iran and keep vessels at anchor.
Then on Tuesday, seemingly out of nowhere, U.S. Energy Secretary Chris Wright made a false claim on social media about the U.S. Navy escorting a tanker through the Strait, which made prices rally.
U.S. crude oil fell 11.94% to close at $83.45 per barrel. Brent crude, the global benchmark, lost 11.28% to settle at $87.80. Prices fell more than 17% immediately after Wright’s post.
Wright had written that “the U.S. Navy successfully escorted an oil tanker through the Strait of Hormuz to ensure oil remains flowing to global markets.” That statement was wrong.
White House press secretary Karoline Leavitt then had to tell reporters that, “The U.S. Navy has not escorted a tanker or a vessel at this time.”
She also said, “I was made aware of this post. I haven’t had a chance to talk to the Energy secretary about it directly. However, I know the post was taken down pretty quickly.”
Later on, an Energy Department spokesperson said, “A video clip was deleted from Secretary Wright’s official X account after it was determined to be incorrectly captioned by Department of Energy staff.”
That same spokesperson said the administration was still focused on keeping the Strait open, saying:-
So while the post was wrong, the broader issue is still real. Washington is openly weighing military options tied to oil shipping.
The White House tells Israel to stop hitting Iran’s oil sites
The U.S. has also asked Israel to stop striking Iranian energy infrastructure, especially oil assets, per Axios.That request matters because it marks the first time the Trump administration has reined in Israel since the two countries launched their joint operation against Iran ten days ago.
One Israeli official said the U.S. messages were delivered at a senior political level and also to IDF Chief of Staff Eyal Zamir.
A second Israeli official allegedly said “the U.S. asked that we notify them in advance of any future strikes on oil facilities in Iran.”
The administration gave three reasons for that request.First, such strikes hurt ordinary Iranians, and a large share of them oppose the regime.
Second, Donald Trump wants to cooperate with Iran’s oil sector after the war, similar to the approach he has taken with Venezuela.
Third, strikes on Iranian energy sites could trigger large Iranian retaliation against energy infrastructure across Gulf states. That would widen the danger for regional supply and keep the oil market tense.
The human cost inside Iran is also rising. Israeli strikes covered Tehran, a city of 10 million, in toxic black smoke and acid rain. That led to urgent health warnings for ordinary Iranians.
Back in the U.S., Republican House lawmakers are gathered in Miami this week to work out a legislative agenda and midterm message built around lower prices and new tax breaks. Some lawmakers at the retreat admitted rising gas prices are painful.
AAA says gas prices are up more than 60 cents from a month ago. Still, they said they trust Trump’s promise that the conflict will end soon and fuel prices will come back down.
The morning after Trump told both lawmakers and markets that the war was ahead of schedule and would be over soon, House Speaker Mike Johnson repeated that message. Mike said the war is “nearly completed” and “gas prices will readjust after that.”
He also told reporters at the GOP retreat, “The Strait of the Strait of Hormuz has been closed by the regime down there, but it will be reopened, and it will take a couple of weeks, but gas prices will come back down.”
Source: https://www.cryptopolitan.com/why-are-oil-prices-surging-once-again/
