Iran Deal and Middle East Conflict Cause Oil & Gasoline Prices Jump 3-1/2 Year High – It’ll Be Painful Driving Season

308

Oil prices rose to multiyear highs, propped by signs that major oil producers are still committed to reducing supply and the rising specter of U.S. sanctions against Iran.

Nexter.org found out what to expect from gasoline prices as the ends.

Gasoline prices – what to expect?

Energy markets are always sensitive to conflicts that pose a threat to supply in the Middle East, the hub of global oil activity. Oil climbed to a three-year high above $79 a barrel following deadly protest in Gaza and the return of US sanctions against Iran.

“U.S. sanctions on Iran take center stage in the oil market,” said Norbert Ruecker, head of macro and commodity at Julius Baer Group Ltd. in Zurich.

Crude has spiked 19% this year, to prices unseen since late 2014.

oil-prices-photo

Source: BI

As for the gasoline prices, which generally follow oil prices, have jumped to a national average of $2.81 a gallon, according to AAA. A gallon of gas went for $2.34 a year ago. The typical family will spend about $200 more this summer driving season, according to the Oil Price Information Service.

Conflicts in oil-producing regions could mean even higher gas prices, posing a threat to U.S. growth as the cost of fuel and gasoline weighs on drivers, airlines, delivery companies and other big consumers.

“It will be more painful for motorists than the past two years — but nothing close to 2011 to 2014 when it was $3.40 to $3.60 a gallon,” said Tom Kloza, global head of energy analysis at OPIS.

gasoline-price-photo

Source: BI

Analysts are already warning of an eventual return to $100 oil. That’s a remarkable swing considering that crude crashed to just $26 a barrel barely two years ago. Others are sticking by predictions that oil prices will come back to earth soon.

“Oil price volatility will continue to increase,” Damien Courvalin, head of energy research at Goldman Sachs, wrote to clients this week.


MORE HOT NEWS

Summary
Description
Oil prices rose to multiyear highs, propped by signs that major oil producers are still committed to reducing supply and the rising specter of U.S. sanctions against Iran. Nexter.org found out what to expect from gasoline prices as the ends.
Nexter.org
Nexter.org
Nexter.org
/wp-content/uploads/2018/04/logo_nexterbg.jpg

Comments are closed.

More News from Nexter