because of greater domestic production<\/a> and\/or rising reliance on renewable energy.<\/p>\nThere are greater emergency oil supplies across the globe\u2014from the U.S. to China\u2014relative to, say, the Arab oil embargo in the 1970s, which was the trigger for the U.S. creating its Strategic Petroleum Reserve.<\/p>\n
Oil traders remain optimistic that this war will prove short lived\u2014although that optimism wanes or waxes a bit each day\u2014and that Saudi Arabia, Iraq, and the United Arab Emirates will continue to successfully reroute portions of their exports to provide temporary buffers until the strait is reopened. Also, Iran continues to export some of its oil while allowing a select few tankers to pass through, such as to India.<\/p>\n
Lastly, and most cynically, this war is most dramatically affecting the supplies thus far of Pakistan, Bangladesh and southeastern Asian countries that depend the most on Middle Eastern supplies for their oil and gas.<\/p>\n
\u201cSoutheast Asia is getting nailed by this, but the reality is, in our part of the world, nobody even knows where Indonesia is,\u201d said Jim Wicklund, veteran oil analyst and managing director for PPHB energy investment firm.<\/p>\n
\u201cAs consumers in the U.S., we\u2019re horribly spoiled,\u201d Wicklund said. \u201cThere\u2019s no panic anywhere. Yeah, my gasoline prices are $1 higher, which is still [nearly] $4 cheaper than Europe.\u201d\u00a0<\/p>\n
As of March 18, the average U.S. price for a gallon of regular unleaded was $3.86, up $1.13\u2014more than 40%\u2014from the January low.<\/p>\n
![\"Getty](\"https:\/\/www.newsbeep.com\/ie\/wp-content\/uploads\/2026\/03\/GettyImages-2264000253_45b03e.jpg\"\/)
<\/p>\n
The tide could still turn<\/p>\n
In the U.S., only about 3% of oil consumption comes from the Middle East\u2014the lowest since the Arab oil embargo of the 1970s. The large majority of U.S. consumption is world-leading domestic production, while Canada provides most of the U.S. imports. Mexico is next.<\/p>\n
\u201cThe U.S. is enjoying the benefit of being somewhat insulated from the physical market tightness right now,\u201d said oil forecaster Dan Pickering, founder of the Pickering Energy Partners consulting and research firm.<\/p>\n
Still, there\u2019s a reason the U.S. decided to release 172 million barrels of oil from its strategic reserves beginning in late March and lasting over a few months. The world is connected.<\/p>\n
Israel has attacked Iran\u2019s South Pars gas field, which prompted Iran to say it will attack the refineries and gas fields of its neighbors. Already, the United Arab Emirates has halted its Shah gas field after Iranian drone attacks. The UAE\u2019s alternative route, the Fujairah oil port, also was attacked.<\/p>\n
If Iran successfully attacks major oilfields of its neighbors, then the \u201chigher for longer\u201d mentality of oil prices will start to set in, Pickering said, because of long-term infrastructure damage. And the stock market will react in real time.<\/p>\n
\u201cIf the market gets ahold of that thematic, it\u2019ll play out quickly,\u201d Pickering warned. That could push the U.S. oil benchmark to $130 per barrel in a couple of weeks or so, he said.<\/p>\n
Derek Bunn, energy economist at the London Business School, agreed.<\/p>\n
\u201cIf things do not get resolved politically fairly soon, then these longer-term effects will start to bite,\u201d Bunn said. \u201cAnd it may not be that long.\u201d<\/p>\n
\u00a0\u201cI think it\u2019s a matter of weeks before people take a longer-term fundamental view,\u201d he added.<\/p>\n
While the global U.S. and European oil benchmarks are trading closer to $100, make no mistake, the prices for Middle Eastern barrels escaping the Persian Gulf are closer to $150 per barrel already, noted Andrew Harbourne, senior oil analyst for the Wood Mackenzie research firm.<\/p>\n
If the Strait of Hormuz remains largely blocked for longer, Harbourne said, \u201cthe global market and pricing would converge at the higher levels observed to date and perhaps beyond $200 per barrel as a function of duration.\u201d<\/p>\n
However, Wicklund sees the war as a matter of \u201cpolitics and logistics\u201d that must get worked out sooner than later, especially because President Donald Trump doesn\u2019t want $100 per barrel oil or higher with the midterm elections coming up in November.<\/p>\n
\u201cEverybody knows this can\u2019t continue.\u00a0Nobody knows how it ends. This is interrupting economic commerce for everyone in the world to the tune of billions of dollars a day,\u201d Wicklund said.<\/p>\n
After all, this war has a compounding effect on much more than just gasoline, diesel, jet fuel, and natural gas. Prices are skyrocketing for aluminum, fertilizer, cooking oil, grains, sugar, petrochemicals, helium, and more. The costs quickly trickle down into inflation on food, electronics, pharmaceuticals, and most consumer goods.<\/p>\n
\u201cBut that\u2019s the whole attitude of the market these days: \u2018We\u2019ll see. I hope it doesn\u2019t take too\u00a0long,\u2019\u201d Wicklund said.<\/p>\n","protected":false},"excerpt":{"rendered":"The war in Iran represents the biggest energy supply shock in history with the Strait of Hormuz choke…\n","protected":false},"author":2,"featured_media":353849,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[72,54970,969,113,61,11829,60],"class_list":["post-353848","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-crude-oil","tag-donald-trump","tag-economy","tag-ie","tag-iran","tag-ireland"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/353848","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=353848"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/353848\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/353849"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=353848"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=353848"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=353848"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}