Story perspectives

Hormuz Shutdown Spurs $112 Oil, US Gas Prices Surge

5/6/2026

Summary

Story summary

The shutdown of the Strait of Hormuz caused the largest oil-market supply disruption, pushing crude to $112 a barrel in early April.
U.S. gasoline prices rose to about $4.48 per gallon nationwide, with California averaging $6.11 per gallon.
U.S. gasoline inventories fell 14% and diesel 17% since February, prompting Strategic Petroleum Reserve releases.
U.S. insurers, including Berkshire Hathaway, refused to insure ships in the strait until the Navy provides escorts.

History

Historical Context

In October 1973 OAPEC, led by Saudi King Faisal, cut production 5 % monthly and embargoed the United States for backing Israel. Prices jumped from $3 to $12 per barrel—a rise of about 300%—prompting the Nixon administration to address energy security. The 1973 shock echoes today as the Strait of Hormuz shutdown threatens comparable market volatility.

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Story summary

The shutdown of the Strait of Hormuz caused the largest oil-market supply disruption, pushing crude to $112 a barrel in early April.
U.S. gasoline prices rose to about $4.48 per gallon nationwide, with California averaging $6.11 per gallon.
U.S. gasoline inventories fell 14% and diesel 17% since February, prompting Strategic Petroleum Reserve releases.
U.S. insurers, including Berkshire Hathaway, refused to insure ships in the strait until the Navy provides escorts.

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