As tensions in the Middle East escalate following Iran’s latest military maneuvers near the Strait of Hormuz, the world’s largest oil and gas executives are privately bracing for a prolonged supply shock that could send global energy prices soaring by as much as 40%—a crisis analysts warn would disproportionately crush working-class households still reeling from inflation. Internal projections shared with investors and obtained by this publication reveal that ExxonMobil, Chevron, and Shell are modeling scenarios where up to 5 million barrels per day of crude could be disrupted if Iran follows through on threats to block the critical chokepoint, which accounts for roughly 20% of the world’s oil supply. The fallout, executives admit, would dwarf the 2022 Ukraine war spike, with gasoline prices potentially hitting $6 per gallon in the U.S. by summer—a threshold that would add $2,000 annually to the average family’s fuel costs.
The looming crisis has exposed deep divisions within the industry over how to respond, with some CEOs quietly lobbying the Biden administration for emergency releases from the Strategic Petroleum Reserve, while others—particularly those with ties to the Trump-era fossil fuel boom—are positioning themselves to profit from the volatility. “This isn’t just about geopolitics; it’s about who gets to control the narrative and the windfall,” said Dr. Elena Vasquez, a senior energy policy analyst at the Carnegie Endowment for International Peace. “We’re seeing the same playbook from 2018, when Trump’s inner circle fast-tracked drilling permits for donors in exchange for political favors. The difference now is that the stakes—and the potential for consumer harm—are exponentially higher.”
Data from the Energy Information Administration (EIA) underscores the risk: during the last major Hormuz crisis in 2019, retail diesel prices surged 23% within weeks, crippling small businesses and trucking fleets. This time, with global inventories already stretched thin, the impact could be twice as severe. Industry whistleblowers allege that at least three major U.S. refiners have begun hoarding diesel stocks in anticipation of shortages, a move that mirrors the controversial “war profiteering” tactics uncovered in a 2021 Senate investigation into pandemic-era price gouging. “The system is rigged to let them win either way,” said Michael Carter, a former Department of Energy official under the Obama administration. “If the White House intervenes, they’ll cry ‘market distortion.’ If it doesn’t, they’ll blame regulation—and jack up prices under the guise of ‘supply constraints.’”
Adding to the outrage is the specter of Trump-era corruption resurfacing amid the chaos. A little-noticed 2023 report from the Government Accountability Office (GAO) found that at least $1.2 billion in federal drilling leases were awarded to companies linked to Trump donors between 2017 and 2020, often at below-market rates. More damning, legal experts point to the president’s controversial pardons of two oil executives convicted of bribery in 2019—a move that cost taxpayers an estimated $45 million in lost fines and restitution. “These weren’t acts of mercy; they were investments,” said Vasquez. “The message was clear: play ball with the administration, and the rules don’t apply.” With the 2024 election looming, critics fear history could repeat itself, as energy lobbyists flood campaign coffers in exchange for promises of deregulation and favorable war-time policies.
For the average consumer, the consequences could be devastating. A recent analysis by the Economic Policy Institute estimates that a sustained $2 increase in gas prices would erase 1.5
Source: US Top News and Analysis