It all traces back to one waterway thousands of miles away. Here’s what a local energy expert says drivers need to know.
HOUSTON — Houston-area drivers are feeling the pinch at the pump as conflict in the Middle East rattles global oil markets, with local gas prices jumping nearly 40 cents per gallon over the past week, even as oil prices dipped slightly on Monday.
According to AAA, the national average for a gallon of gas now sits at $3.53. Houston is below that average at $3.08 a gallon, but that figure still represents a sharp climb from just a week ago.
At the center of the concern is the Strait of Hormuz, a narrow waterway between Iran and Oman that connects the Persian Gulf to the open ocean. Roughly 20% of the world’s oil supply passes through this route, making any disruption there a global economic event.
KHOU 11 energy expert Ed Hirs explained why the strait is drawing so much attention right now.
“Now the issue is the Strait and foremost. We’ve got millions of barrels of oil bottled up because the insurance companies don’t think it’s a very safe thing to ship the tankers through. And of course Iran has threatened to blow up tankers. They’ve attacked tankers in the past.”
Jay Young, CEO of King Operating Corporation, broke down how a chokepoint thousands of miles away translates directly to what drivers pay at the pump.
“20% of all oil goes through this Strait of Hormuz. And why does that affect us back home? And when I go get gasoline at the pump, that’s a great question. But it’s because of the disruption. And OPEC countries are starting to dial it back a little bit on their production and their countries because they’re like, well, if I can’t get it down that Strait of Hormuz and get paid, why am I going to produce it?”
While oil prices settled down Monday, uncertainty about where the conflict is headed continues to hang over the market and leaves open the question of how much more pressure consumers could see at the gas station.
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