U.S. Energy Secretary Says Gasoline Below $3 May Not Return Until Next Year

[The Financial News, New York City (NYC) = Reporter Lee Byung-chul]As market jitters continue amid the prolonged war between the US and Iran, analysts say it may take a long time for gasoline prices to return to prewar levels.
U.S. Secretary of Energy Chris Wright said in a CNN interview on the 19th that gasoline prices could fall below $3 per gallon later this year, but that the drop could also be delayed until next year. He added that prices have likely already peaked, while noting that energy prices would fall once the conflict is resolved.
Wright also said that, adjusted for inflation, a price below $3 per gallon is highly significant. He explained that such levels were possible during the Trump administration, but had been difficult to see for a long time in real terms. He stressed that prices would eventually return to that range.
In fact, gasoline prices have risen sharply since the war began. The average price of regular gasoline in the US stood at around $2.90 per gallon in early February, but has since surged to about $4.04.
The Strait of Hormuz is at the center of the disruption. Since the outbreak of war, Iran has effectively controlled the key shipping lane through which about 20% of the world's crude oil passes, heightening supply concerns.
More recently, however, hopes for negotiations have put some downward pressure on oil prices in the short term. International crude prices fell late last week after the US and Iran signaled a possible reopening of the strait.
Market watchers say it will be difficult for oil and gasoline prices to stabilize in the near term, as the war drags on and uncertainty over talks persists. In particular, whether the Strait of Hormuz returns to normal operations is expected to be a key variable for the energy market going forward.


pride@fnnews.com Reporter Lee Byung-chul Reporter