economy
If not for America’s oil boom, $4 gas likely would already be here. But the US can’t avoid that pain point by itself
The United States is producing more oil than any country in the history of the planet. Yet the war with Iran has sent gas prices up 20 cents a gallon, or 7% in just a few days.
TL;DR
- The US is producing more oil than any country in history, but gas prices have still risen due to the conflict with Iran.
- Oil is traded on a global market, and US domestic production and exports/imports make it subject to international supply and demand.
- The Strait of Hormuz, through which 20% of the world's oil passes, is experiencing a de facto shutdown, alarming traders.
- The US oil boom, driven by fracking since 2009, has helped smooth out geopolitical price spikes.
- If the Strait of Hormuz does not reopen soon, oil prices could exceed $100 a barrel, and gasoline prices could go above $4 a gallon nationally.
- Traders are also concerned about potential damage to oil facilities in allied Middle Eastern countries.