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Peak oil prices still ahead: US explains reasons for rise in price

Main points
  • US Energy Secretary Chris Wright predicts an increase in oil prices due to the tense situation around the Strait of Hormuz.
  • US President Donald Trump links high oil prices to the consequences of the war against Iran.
  • The restoration of full shipping through the Strait of Hormuz remains a key factor in stabilizing oil prices.
Oil. Photo: Depositphotos.
Oil. Photo: Depositphotos.

World oil prices may soon reach a maximum, but before that, they will continue to grow due to the tense situation around the Strait of Hormuz. US Secretary of Energy Chris Wright has stated this.

According to him, the key factor is the restoration of full-fledged shipping: "We're going to see ​energy prices high - and maybe even rising - until we get meaningful ship traffic through ​the Strait of Hormuz. That'll probably hit the peak oil price ⁠at that time. That's probably sometime in the next few weeks."

He added that energy will remain expensive or even become more expensive until sufficient tanker volumes start to pass through the strait.

Against this backdrop, the United States also records an increase in oil production in Venezuela after changes in legislation and actions of the authorities led by Nicolas Maduro. According to the US side, since the beginning of the year, about 150 million barrels of oil have been sold there, and production has increased by a quarter.

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US President Donald Trump has admitted that high fuel prices may persist for several more months: "The price of oil and gasoline may remain high until November's midterm elections." He attributed this to the consequences of the war against Iran.

After the outbreak of hostilities, Tehran effectively restricted the passage through the Strait of Hormuz for most foreign vessels, trying to consolidate control over the strategic route and potentially introduce transit fees.

In response, the US Navy expanded the blockade to the adjacent waters - the Gulf of Oman and the Arabian Sea. According to monitoring data, some oil tankers are already forced to change routes, which further affects the market and pushes prices up.

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