The United States will unveil a phased plan to mitigate the spike in oil prices amid the ongoing conflict in Iran and the wider Middle East, U.S. Secretary of State Marco Rubio said late on Monday as oil prices jumped by 10% following the U.S.-Israel strikes on the Islamic Republic.
Oil jumped on Monday as flows through the vital Strait of Hormuz were severely restricted and oil companies, traders, shippers, and insurers hastened to halt operations. In addition, the world’s biggest maritime insurers and insurers’ clubs are ending war risk coverage for vessels transiting the Persian Gulf and the Strait of Hormuz, following the escalation of the conflict in Iran.
The U.S. knew that oil prices would spike after the weekend in which attacks on Iran began, Secretary Rubio said.
“We knew that going in would be a factor. And so we have a program in place that will begin to be implemented by Secretary Wright, Secretary Bessent,” Rubio said, referring to Energy Secretary Chris Wright and Treasury Secretary Scott Bessent.
“And starting tomorrow you will see us rolling out those phases to try to mitigate against that,” Secretary Rubio added.
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“But there is a plan in place. We anticipated this could be an issue. And Secretary Wright and Bessent will begin to roll out those steps starting tomorrow to mitigate – to mitigate – against the impact that could have.”
Meanwhile, the surge in oil prices was immediately felt at the U.S. gas stations as the national average price of gasoline topped $3 per gallon for the first time since November. The price spike from the Iran war and the more expensive summer-grade gasoline that refineries are now producing combined to send the average gasoline price higher compared to a year ago.
The national average price of gasoline has risen above its year-ago level for the first time since November and stands at $3.052 per gallon, up by 11.1 cents/gal as of late Monday, Patrick de Haan, head of petroleum analysis at GasBuddy, said. Diesel prices jumped even higher, and the average diesel prices in the U.S. have risen to their highest level since July 2024 at $3.812/gal according to live GasBuddy data, de Haan noted.
By Tsvetana Paraskova for Oilprice.com
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