Key Takeaways:
- Trump’s April 13 blockade on Iran spiked WTI crude to $104, threatening future US gas prices next.
- March CPI rose 0.9% amid an oil price surge, forcing Trump to brace for midterm election fallout next.
- With Gasbuddy tracking $4.08 US gas, Iran’s Qalibaf warns pump prices will soon exceed $5 next.
Oil Prices Rise as U.S. Announces Hormuz Strait Blockade
Oil markets continue to experience increased volatility, affected by the comings and goings of the ongoing conflict in the Middle East.
As President Trump announced that the U.S. would exert a military blockade on ships going through the Hormuz Strait following the failure of the mediation to end the current war, prices experienced a hike, as the West Texas Intermediate (WTI) and Brent benchmarks registered a 10% rise at market open.
WTI futures rose to over $104 per barrel, while their Brent counterparts reached over $102. The U.S. Central Command (CENTCOM) forces announced that the blockade, which will target “all maritime traffic entering and exiting Iranian ports,” will begin enforcement on April 13 at 10 a.m. ET, as President Trump stated on social media.
The move is expected to exacerbate gas prices at the pump in the U.S., which have already reached $4.08 per gallon according to Gasbuddy data.
Even President Trump recently admitted that high oil prices might persist until the upcoming midterm congressional elections. Asked by Fox News’s Anchor Maria Bartiromo about whether gas and oil prices would be lower before the upcoming elections, he stated:
I hope so. I mean, I think so, it could be, it could be, or the same or maybe a little bit higher, but it should be around the same.
Energy prices have already shocked the U.S. economy, leading to a 0.9% inflation rise in March, with the month’s Consumer Price Index (CPI) reaching 3.3% during the last 12 months.
Mohammad Baqer Qalibaf, Speaker of the Islamic Republic of Iran’s Parliament, told Americans to “enjoy the current pump figures.” “With the so-called ‘blockade’, soon you’ll be nostalgic for $4–$5 gas,” he concluded.