Gas Prices Set to Surge in Wake of Persian Gulf Bombings

Expect to pay $3 a gallon—or more—this week after Iran shut down a vital shipping lane for oil tankers following U.S. air strikes

BY KEVIN HAYNES, NEWS WRITER

The cost of gasoline is expected to jump to more than $3 a gallon nationwide this week amid the United States and Israel’s escalating military action in oil-rich Iran.

Prices at the pump haven’t averaged that high nationally since November and were as low as $2.85 in February, according to the retail price tracker GasBuddy.

Gas costs could shoot even higher now that the Iranian government has closed navigation lanes through the Strait of Hormuz, a critical passageway for tankers transporting nearly a fifth of the world’s oil. Reuters reports that three tankers off the Gulf coast were damaged in weekend bombings by Iran in retaliation for the surprise U.S. and Israeli air strikes that pummeled Tehran and killed the country’s supreme leader, Ayatollah Ali Khamenei. At least 200 tankers carrying oil and liquified gas have reportedly dropped anchor in the area.

“The U.S.-Israeli attack on Iran dramatically increases the security risk to ships operating in the Persian Gulf and surrounding adjacent waters,” said Jakob Larsen, chief safety and security officer at the shipping association BIMCO. “Ships with business connections to U.S. or Israeli interests are more likely to be targeted, but other ships may also be targeted deliberately or in error.”

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The conflict has already rocked oil prices. Crude oil spiked to $80 a barrel on Sunday, a 10 percent increase. Analysts warned the price could soar beyond $100 if the war continues.

A $5 per barrel price increase for crude typically bumps up gas and diesel costs by 12-25 cents a gallon.

Gas prices had already been inching up in January as refiners started producing summer-grade fuel, a more costly blend mandated by environmental rules to stanch air pollution in warm weather.

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