Energy Expert Warns Oil Prices Could Hit $150 Per Barrel If Strait of Hormuz Supply is Disrupted

Developments in the Middle East have recently made the oil market apprehensive. Amidst fears of potential supply disruptions, energy economist Ed Hirs has warned that if oil supply passing through the Strait of Hormuz is blocked, global oil prices could surge to as high as $150 per barrel.

According to Hirs, a professor at the University of Houston, fuel prices will continue to rise if supply disruptions persist due to the ongoing US-Israel military action against Iran. "If half the oil coming through the Strait of Hormuz is stopped, and the US Navy cannot secure the tankers, the price of oil could jump to $150 for a short period," he stated.

Hirs also noted that the impact is already being seen in the Liquefied Natural Gas (LNG) market. According to him, LNG prices rose by more than 40% on the first day, and the price of natural gas across Europe nearly doubled between Monday and Tuesday. He also mentioned that diesel prices have risen disproportionately. He added that some countries dependent on gas have started increasing their petroleum purchases, affecting future orders in some US states.

"This will have a major impact on the New England states in America," he added. "If this situation arises, it could become very bad for President Trump domestically, especially in the context of the upcoming midterm elections."