President Trump claims the Strait of Hormuz is no longer a factor in gas prices, pointing to refineries, but tanker attacks persist and prices have risen.
A tanker in the Strait of Hormuz was hit by a projectile on Monday, causing a fire in its engine room. At the same time, President Donald Trump is contending that the strait is no longer the reason Americans pay higher gas prices.
The UK Maritime Trade Operations agency (UKMTO), which records attacks on commercial vessels, reported that the crew was battling a fire in the engine room. This marked the agency's 10th incident notice since October 1.
US President Donald Trump said that bottlenecks at the Strait of Hormuz were no longer the cause of higher fuel costs for Americans. He instead pointed to refineries.
"What's driving up Gasoline is no longer the Strait of Hormuz, because Record Numbers of Barrels are coming out now on an almost daily basis, but the word, 'Refineries,' where Russia's are being blown up by Ukraine, and where ours are being closed up, in Blue States, like California, by the Dumocrats," the President wrote on Truth Social.
There is some truth to that. According to Kpler data, Middle East crude exports averaged 18.5 million barrels a day in the week to October 1, which is above pre-war levels.
Yet attacks on vessels continue. The Monday fire occurred just days after a previous attack on a tanker in the Strait of Hormuz had unsettled markets.
US crude was around $66 a barrel on February 27, the last trading day prior to US and Israeli strikes on Iran. It closed Monday at roughly $91.57, according to TradingView data.
The global benchmark Brent increased from around $67 to $104. Wholesale gasoline rose from about $2.30 to $3.20 a gallon. All three commodities saw a surge in spring, a decline in July, and another jump in September.
AAA reported that regular gasoline at the pump was $4.37 a gallon on Monday, up from $3.13 a year earlier.
Ukrainian drones have heavily damaged Russian refineries. The International Energy Agency (IEA) reports that Russian diesel production dropped by nearly 30%. Russia has prohibited diesel exports by producers until October 31.
In the US, diesel cost $6.32 a gallon, almost $2 more than gasoline. Banks have cautioned that a US diesel export ban would drive gasoline prices even higher.
The Energy Information Administration (EIA) says California's two shuttered refineries processed about 284,000 barrels a day, which is less than 2% of US capacity.
On Monday, the Group of Seven (G7) decided to release 100 million barrels of emergency oil. The US midterm elections are scheduled for November 3.
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US commanders are ready to launch a three-day campaign against Iran's energy, missile, and command targets within days if President Trump approves.
Oil rose about 4% Thursday on Middle East tensions and Gulf storm shut-ins; gains pared after Trump ruled out pre-midterm Iran strike.
Unconfirmed Arab sources report multiple severe explosions in the Strait of Hormuz, targeting a tanker.
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