If you’re anything like me, you probably get an unholy case of the bubble guts when you head toward the gas station to fill up your vehicle, as your mind churns and burns with a million different guesses as to which body parts you might need to sell on the black market in order to afford fuel. Sometimes it’s necessary to say a few prayers and clinch up tight in order to avoid having a tragic accident on the way there, and I’m not talking about a car wreck.
I mean, right now, here in the good ole U.S. of A., the average price of gasoline is hovering right around $3.63 per gallon. And that is enough to make me want to pull my hair out. You likely feel the same way, especially if you have a truck, van, or SUV. Now, imagine how quickly you’d go bald if you had to upwards of $7 per gallon? Wig makers would experience record profits.
The Economic Collapse released an article stating that while such a price is the thing our nightmares are made of, they could become our reality in the near future. The reason why? The chaos currently unfolding in the Middle East concerning Israel, Iran, and Hamas. The report points out that almost a fifth of the oil used by whole world travels through the Strait of Hormuz. A massive war in that region could possibly close down the strait until the conflict was brought to an end. Along with that, oil infrastructure could be wiped out in Iran or other countries located in the Middle East as the fighting continues to rage on, which means a massive reduction in global oil production for a long period of time.
In case you haven’t noticed, civilization as we know it depends on the ability to purchase cheap oil, so a spike in prices caused by wars in the Middle East will have a negative impact on everyone.
Even though the average price of a gallon of gasoline has risen more than 20 cents in a month, I would still consider it to be at a very low level, especially compared to what is eventually coming.
One expert that was interviewed by MarketWatch is warning that the average price of a gallon of gasoline in the U.S. could hit $5.40 this summer…
Colas estimated that a spike in oil prices pushing U.S. gasoline to $5.40 a gallon this summer would make a recession later in 2024 “a genuine possibility.” U.S. gas prices averaged $3.634 a gallon at the pump on Monday, according to AAA, at last check.
The very same expert also issued a warning that if oil prices blast over $125 a barrel, it could end up pushing the economy into a recession:
“Crude prices are our chief concern, but we are a long way” from $125 a barrel — a level of West Texas Intermediate oil that “would almost certainly cause a recession if sustained,” said Colas. “Gasoline prices are the transmission mechanism between Mideast conflict and the US economy: when pump prices increase quickly, consumers must cut back on other spending.”
The EC stated that he’s not nearly as optimistic.
He went on to note that if both Israel and Iran start tossing bombs back and forth at each other, there’s a possibility that price of a barrel of oil could skyrocket over $150, which would then cause the cost of gasoline to spike over $7.00. If, God forbid, nuclear weapons were used, the author said, well, there’s no way to no just how bad things might get from there. Let’s hope and pray that does not happen.
Currently, the markets are waiting to see if Israel will retaliate for the strikes Iran launched against them.
If they do choose to strike back and target oil infrastructure, well, that’s guaranteed to make oil prices go up.
If Israel does retaliate, and it becomes a full-fledged conflict, that’s a different story. “And maybe Iran’s oil platforms, refineries are taken out,” he said. “That would send oil prices up.”
The EC article wagered this was indeed going to be the outcome, as Israel is reportedly making preparations to retaliate as we speak. This, of course, will cause the already wild antisemitic streak running through our culture to get even worse as folks will pour out all the blame on the Jewish state when they should be pointing fingers at Hamas, Iran, and radical Islam.
In the event of a total war between Iran and Israel, you can basically count on the Strait of Hormuz will be shut down and this will be a huge blow to the world economy.
Potential impacts on the shipping transiting through the Strait of Hormuz, a chokepoint for about one-fifth of the world’s total oil consumption, will also factor into markets’ pricing.
The commander of Iran’s Revolutionary Guard’s navy said on Tuesday that Iran could close the strait if deemed necessary, and earlier on Saturday Iran’s state-run IRNA news agency said an IRGC helicopter boarded a vessel, the Portuguese-flagged MSC Aries, and took it into Iranian waters.
We need to be on our knees, hands clasped, praying to God that this is not what goes down, because we’re all already hurting bad enough from Biden’s bad economy policies. This will deal a devastating blow that will sink the battleships of many American families. Not literal battleships, I’m referring to the game. You know what I mean.