Oil Could Surge to $150 if Strait of Hormuz Is Blocked, Analyst Warns
Escalating Iran–Israel conflict raises fears of global energy supply disruption.
Oil prices could spike dramatically if shipping through the Strait of Hormuz is blocked amid the ongoing Iran–Israel conflict, according to energy economist Ed Hirs.
Hirs, a lecturer at the University of Houston, warned that crude prices could climb to $150 per barrel if a significant portion of oil shipments through the strategic waterway is disrupted.
“If half of the oil coming through the Strait of Hormuz is stopped, perhaps because the United States Navy could not escort tankers anymore, then we could see the price of oil spike up to $150 a barrel for a period of time,” he told Al Jazeera.
The analyst said the impact is already visible in global energy markets. Liquefied natural gas (LNG) prices reportedly surged over 40 percent on the first day of the escalation, while natural gas prices across European markets nearly doubled within a short period.
Hirs also noted a sharp increase in diesel prices, adding that some countries that rely heavily on gas have begun purchasing petroleum as an alternative fuel. This shift is affecting supply contracts and future energy orders, including in parts of the United States.
He warned that the situation could have significant domestic consequences for Donald Trump, particularly with the United States midterm elections approaching.
“This will have a tremendous impact on the New England states in the US,” Hirs said, suggesting that rising energy costs could intensify political pressure if the conflict continues to disrupt global oil supplies.
Source: Al Jazeera
