politics
Gasoline Prices Remain Elevated as Crude Oil Returns to Pre-War Levels
National average gasoline prices stood at $3.90 per gallon on Friday, nearly $1 above late February levels, while the U.S. benchmark WTI crude oil traded near $69 per barrel. The gap follows a U.S.-Iran memorandum of understanding that reopened the Strait of Hormuz after earlier closures.
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Gasoline prices have not declined at the same pace as crude oil prices following the U.S. and Iran agreement to reopen the Strait of Hormuz. The national average for gasoline reached $3.90 per gallon on Friday, according to AAA data, compared with roughly $4.50 earlier in the year when Iran restricted shipping through the waterway.
Crude oil prices have largely returned to pre-conflict levels. The U.S. benchmark WTI crude traded at about $69 per barrel on Friday, close to the $67 level recorded before the conflict began.
Retail gasoline operators faced margin pressure during the period of rapid price increases, according to Rob Smith, director of global fuel retail at S&P Global Energy’s Refining and Marketing group. He stated that operators are now seeking to recover those margins over time.
Andy Lipow, president of Lipow Oil Associates, said major oil companies own less than 5 percent of service stations even though their brands appear at most locations. He added that local station owners set the retail prices consumers see.
The Trump administration conducted strikes against Iranian missile, drone storage, and coastal radar sites on Friday night. The memorandum of understanding between the U.S. and Iran includes provisions to maintain free passage through the Strait of Hormuz, which normally carries about one-fifth of global oil consumption.
