America Under High Oil Prices: Oil Giants in Panic, Energy Secretary Fighting Fires, Public Suffering from Oil Prices for Long

Source: Huìtōng.com

Huìtōng Finance APP News — Recently, senior executives in the U.S. oil industry have been warning the Trump administration that the energy crisis triggered by the Iran situation could worsen further. During a series of White House meetings on March 11 and recent communications with Energy Secretary Chris Wray and Interior Secretary Deb Haaland, CEOs of ExxonMobil, Chevron, and ConocoPhillips unanimously stated that disruptions in energy transportation through the Strait of Hormuz will continue to cause significant volatility in the global energy markets. The executives emphasized that current supply disruptions have already caused oil prices to fluctuate at high levels. If the conflict persists long-term, production cuts by Gulf oil-producing countries and saturated storage will further tighten global supply, significantly increasing the risk of an energy crisis. On Monday (March 16), during Asian trading hours, U.S. crude oil prices fluctuated downward, currently trading around $97.60 per barrel, down approximately 1.1% for the day.

Disruption in Hormuz Will Cause Severe Volatility

At the White House meeting, the CEOs of the three major oil companies directly stated: As the world’s most critical oil choke point, the Strait of Hormuz, if interrupted long-term, will trigger the largest supply shock since the 1970s oil crisis.

Currently, shipping is nearly halted, Gulf countries’ storage facilities are full, and they are forced to significantly cut production. The global daily supply gap has reached several million barrels. The CEOs warned that extreme fluctuations in energy prices will transmit to transportation, chemicals, manufacturing, and agriculture, pushing up core inflation and suppressing economic growth.

U.S. Energy Secretary Wray: High oil prices will persist for weeks but will ultimately eliminate the biggest risks

U.S. Energy Secretary Chris Wray said last Sunday that the public is feeling the pressure of high oil prices, and this feeling will continue for several weeks. However, he emphasized, “Ultimately, we will eliminate the biggest risks facing global energy supply.”

Wray pointed out that the U.S. is easing the impact through measures such as naval escort, encouraging IEA releases, and temporary sanctions exemptions. Once the Hormuz passage is restored or supply substantially improves, the pressure of high oil prices will quickly ease.

Gasoline prices may fall below $3 per gallon before summer, but war uncertainties remain high

When asked whether gasoline prices could fall below $3 per gallon before summer, Wray believed it was “very likely,” but stressed that the war remains uncertain, and the timeline is unclear.

Currently, the national average gasoline price in the U.S. has risen above $3.60 per gallon, with some areas approaching $4, and diesel reaching $4.89, a recent high. Wray reiterated that lowering oil prices is a clear goal of the current administration, but the final outcome still depends on the conflict’s development and the speed of Strait recovery.

Ongoing Disruption in Hormuz and Gulf Production Cuts Tighten Global Supply

Since the U.S. launched large-scale airstrikes against Iran, shipping through the Strait of Hormuz has nearly halted, blocking about 20% of global oil exports and a large portion of LNG exports. Gulf countries (Saudi Arabia, Iraq, UAE, Kuwait, etc.) are saturated with storage and have been forced to significantly cut production, with the global daily supply gap reaching several million barrels.

Iran continues to threaten to block the passage and attack oil tankers, causing high tension in the global energy market. Asian importing countries face the greatest impact, with U.S. gasoline and diesel prices hitting recent highs.

Short-term high oil prices are hard to ease; medium- and long-term depend on conflict development and release of reserves

In the short term, the pressure of high oil prices is difficult to substantially ease: the disruption in Hormuz shows no signs of recovery, and Iran’s tough stance and active proxies keep supply uncertain. Measures such as IEA releasing 400 million barrels and U.S. temporary exemptions on Russian oil purchases can provide buffers, but logistics delays and the scale of the gap limit their effectiveness.

In the medium to long term, oil price trends depend on whether Iran escalates retaliation, the timing of Strait reopening, and the actual implementation of G7/IEA reserve releases. If the conflict becomes prolonged, high oil prices will become the new normal, further amplifying global inflation and economic slowdown risks.

Editor’s Summary

U.S. oil giants collectively warn the Trump administration that the energy crisis triggered by the Iran situation could worsen further. ExxonMobil, Chevron, and ConocoPhillips CEOs stated at the White House that disruptions in the Strait of Hormuz will continue to cause severe volatility.

U.S. Secretary of Energy Wray admits that the pressure of high oil prices will persist for weeks but emphasizes that the biggest risks will eventually be eliminated. Gasoline prices may fall below $3 per gallon before summer. Currently, the national average gasoline price is $3.60, with diesel at $4.89, hitting recent highs, amid ongoing Hormuz disruptions and Gulf production cuts tightening global supply.

Short-term high oil prices are hard to ease; medium- and long-term depend on conflict development and reserve releases. Investors should beware of Iran escalating retaliation causing price reversals, and monitor Strait reopening and G7/IEA coordination progress. Energy market uncertainties remain high.

As of 9:08 Beijing time, U.S. crude oil is trading at $97.87 per barrel.