Oil holds above $100 on Hormuz risk; U.S. gas nears $5

How an Iran conflict could raise U.S. gas prices, and why

Markets tend to reprice crude and refined fuels quickly when geopolitical risk rises in the Gulf. Tensions between the United States and Iran have already corresponded with higher oil prices across the country, including in New Jersey, according to NorthJersey.

The recent starting point matters for consumers. Gasoline prices were on track for a 12th straight week below $3 per gallon, with seasonal increases expected into spring, as reported by AOL. A new risk premium layered on top of this low base could make any move at the pump feel sharper.

Why the Strait of Hormuz drives oil and pump prices

The Strait of Hormuz is a critical chokepoint linking Gulf producers to global buyers. Even without a physical stoppage, elevated military risk can add insurance and shipping costs and lift crude benchmarks, which then filter through to wholesale racks and retail gasoline.

Any military uncertainty in the Gulf tends to push up global energy costs, a dynamic that can translate into higher pump prices, as noted by Newsweek. The near-term jump often reflects a risk premium; sustained, outsized increases generally require a realized supply loss or persistent disruption.

As reported by Fortune, “The stakes are so high … The biggest risk to a disruption would be from Iran if they’re backed into a corner and have nothing to lose,” said Dan Pickering, founder of Pickering Energy Partners. In the same analysis, experts including Rystad Energy’s Claudio Galimberti assessed that a severe Strait of Hormuz disruption could send oil above $100 per barrel and map to U.S. gas prices near $5 a gallon, while a contained flare-up would imply smaller, more transient moves.

Immediate price channels: risk premium, crude shocks, regional spikes

The first channel is a risk premium in crude futures when traders handicap threats to Hormuz. GasBuddy’s Patrick De Haan has said that even rumors of a closure can lift oil and nudge the U.S. average to roughly $3.40–$3.50 per gallon in the short term, with spikes unlikely to persist unless the conflict escalates, according to Fox Business.

If actual barrels are delayed or diverted, the second channel is a direct crude shock that tightens global supply and widens refined-product spreads. A third channel is regional: logistics bottlenecks, local taxes, and refinery configurations can produce uneven pump moves across states even when the national average rises.

Scenario paths: contained conflict vs Hormuz blockade, oil above $100 per barrel

In a contained conflict that avoids a full choke on Hormuz, oil could rise by about $15–$20 per barrel, with U.S. gasoline hovering closer to the $3–$4 range, according to Claudio Galimberti, chief economist at Rystad Energy. Such moves would likely reflect elevated risk rather than a prolonged, realized loss of supply.

In a blockade or materially hindered transit through Hormuz, analysts have warned that oil could move above $100 per barrel and push U.S. pump prices toward $5 a gallon; this severe-case framing has been outlined by Dan Pickering at Pickering Energy Partners alongside other market watchers. The magnitude and duration would hinge on the extent of disruption and the speed of any rerouting or protection of shipping lanes.

At the time of this writing, Exxon Mobil (XOM) shares were quoted near $151.15, based on Nasdaq real-time price data; this market snapshot is provided for context and does not indicate a directional view on energy equities or fuels.