The war in Iran has caused a sharp spike in oil prices, but now that Operation Epic Fury seems to be winding down and there are talks of negotiations between Iran and the U.S., many hope this could be the light at the end of the tunnel.
This is of course raising the question of how long it might take to see oil prices fall and relief at the pump. The Pentagon has said it could take as long as six months for the Strait of Hormuz to be cleared and things returned to normal. Would it really take that long?
Market analyst Phil Flynn with the Price Futures Group thinks it could happen a lot faster. “For example, we saw the price of gasoline plummet after a report that Iran let three tankers through and more could be coming,” he said.
Flynn believes that because the price is currently so high, there’s a lot of room for it to fall quickly and then settle after the war ends.
He adds that President Trump has already taken action that could help push prices down. According to Flynn: “He’s waived the summertime blend regulations, which takes the pressure off of refiners and gives them the ability to produce more gas.”
He says pausing the gas tax could also go a long way toward quickly reducing prices at the pump.