US says oil prices will climb further, names expected peak timing
Oil tanker (Photo: Getty Images)
US Secretary of Energy Chris Wright stated that the peak of global oil prices will likely occur within the next few weeks, after shipping through the Strait of Hormuz resumes, reports Reuters.
US Energy Secretary's forecast
Speaking at the Semafor economic forum in Washington, Chris Wright noted that energy prices will remain high, and may even rise further, until real volumes of ships begin passing through the strait.
"That'll probably hit the peak oil price at that time. That's probably sometime in the next few weeks," Wright said.
He also reported an increase in oil production in Venezuela following the capture of Nicolás Maduro and reforms to oil legislation. Since January 3, 150 million barrels of Venezuelan oil have been sold, with production rising by 25%.
Trump's admission
US President Donald Trump said on Sunday that oil and gasoline prices could remain high until the November midterm elections. This is a rare acknowledgment of the potential political consequences of his decision to go to war against Iran six weeks ago.
Situation in the Strait of Hormuz
Since the beginning of the war (February 28), Iran has effectively closed the Strait of Hormuz to all vessels except its own. Tehran is trying to make its control over the waterway permanent and possibly charge a fee for passage.
In response, the US Navy imposed a blockade of the strait, extending it to the Gulf of Oman and the Arabian Sea. Vessel tracking data shows that two tankers turned around in the strait after the blockade began.
On April 11, talks between the US and Iran on the nuclear program took place in Pakistan, which ended inconclusively – Tehran rejected the American side's demands.
After the failure of the dialogue, Donald Trump announced a naval blockade of the Strait of Hormuz: US ships will intercept any vessel that has paid Iran a transit fee.
The US President also warned that if Iranian forces attack American ships, Washington will send the Iranians to hell.
Tehran responded: Iranian Parliament Speaker Mohammad Bagher Ghalibaf stated that soon everyone will look back with nostalgia on $4–5 gasoline.
