WASHINGTON: Oil prices are likely to hit their peak “in the next few weeks” once ship traffic resumes through the Strait of Hormuz, United States Department of Energy Secretary Chris Wright said on Monday (Apr 13).
Prices are expected to continue rising until “meaningful” ship traffic resumes through the strait, Wright told the Semafor World Economy Forum in Washington, despite previous comments he made that oil prices would likely come down soon.
“We’re going to see energy prices high – and maybe even rising – until we get meaningful ship traffic through the Strait of Hormuz,” Wright said. “That’ll probably hit the peak oil price at that time. That’s probably sometime in the next few weeks.”
US President Donald Trump said on Sunday that the price of oil and gasoline may remain high until November’s midterm elections, a rare admission of the potential political fallout from his decision to attack Iran six weeks ago.
Since the war started on Feb 28, Iran has largely blocked the Strait of Hormuz for all ships but its own. Tehran has been seeking to make its control of the waterway permanent and possibly collect levies from ships that use it.
In response, the US military has initiated a blockade of the Strait, saying it would extend east to the Gulf of Oman and Arabian Sea after weekend talks to end the conflict collapsed.
Ship-tracking data showed two ships turned around in the strait as the blockade went into effect.