Now may be the time for Americans to consider storing their larger SUVs, pickups and luxury vehicles in lieu of horses, bicycles or small cars — or becoming independently wealthy.
Some experts are predicting anywhere from $5 to $10 per gallon gasoline in the United States by the summer, if Iran has its way and somehow either blocks or mines the Strait of Hormuz, or by any other means attempts or succeeds in blocking the flow of oil from the Middle East to other points on the globe — to include, of course, the United States.
Oddly enough, at this time, the #1 export of the US is refined fuel. We are able to export this refined product because national consumption has decreased.
That said, we import the massive bulk of our crude oil.
Iran has already threatened to block the Strait of Hormuz.
US military representatives agree that Iran has the power to do this, which would impact not only US energy flow, but global energy flow as well. The US military indicates it has the ability to take steps to re-open the Strait of Hormuz choke point.
But would Obama even make that decision in the first place or, as he has expressed frequently, would he simply be “concerned” and “monitor” the situation?
Iran has made another statement with regard to the world’s fuel supply:
CAIRO (AP) – Iran warned Gulf Arab oil producers against boosting production to offset any potential drop in Tehran’s crude exports in the event of an embargo affecting its oil sales, the latest salvo in the dispute between the West and the Islamic Republic over its nuclear program.
The comments by Iran’s OPEC governor, published Sunday, came as Saudi Arabia’s oil minister was quoted the same day denying that his country’s earlier pledges to boost output as needed to meet global demand was linked to a potential siphoning of Iranian crude from the market because of sanctions.
World oil markets have been jolted over concerns that Iran may choke off the vital Strait of Hormuz in retaliation for sanctions hampering its ability to sell its oil. Saudi Arabia and other key Gulf Arab producers have recently said they are ready to provide stable and secure supplies of oil.
Iran’s official news agency IRNA said Sunday that the U.S. has relayed a message to Iran about security in the Strait of Hormuz. It gave no details, and there was no immediate comment from Washington.
The U.S. recently imposed sanctions targeting Iran’s central bank and, by extension, refiners’ ability to buy and pay for crude. The European Union is also weighing an embargo on Iranian oil, while Japan, one of Iran’s top Asian customers, has pledged to buy less crude from the country.
Mohammad Ali Khatibi, Iran’s OPEC governor, was quoted Sunday by the pro-reform Shargh newspaper as saying that attempts by Gulf nations to replace Iran’s output with their own would make them an “accomplice in further events.”
“These acts will not be considered friendly,” Khatibi said, adding that if the Arab producers “apply prudence and announce that they will not participate in replacing oil, then adventurist countries will not show interest,” in the embargo.
The point tips, my friends.
This may not end well.
BZ
