US-Iran Conflict Drives Record Gas Prices as Tensions Over Hormuz Escalate
The recent US missile attacks on Larak island in southern Iran have led to a new escalation in the ongoing conflict between the two nations. The strikes, which targeted rocket launchers, resulted in Iranian retaliation with eight missiles fired towards two US bases in Jordan.
However, according to Jordanian authorities, all of these missiles were intercepted, and there were no reported casualties. This latest development has heightened tensions in the region, particularly regarding the Strait of Hormuz, a critical waterway through which 12 million barrels of crude oil are typically transported daily.
Before the US-Iran conflict intensified, around 130 ships per day would transit the Persian Gulf, carrying 20% of global petroleum and 20% of the world's liquefied natural gas (LNG). However, since the Memorandum of Understanding was observed by the Trump administration, only 6.1 million barrels per day have been coming out of the Gulf.
The recent tensions have already had a significant impact on global oil prices. According to The Independent, gasoline prices in the US soared above $4 a gallon every day in August, an unprecedentedly high price, even surpassing that of August 2022 after the Russian invasion of Ukraine.