FILE-A customer pumps gas at a Chevron gas station on February 13, 2025 in Austin, Texas. (Photo by Brandon Bell/Getty Images)
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The price of oil increased more than 4% after Sunday night, but it moved back as the focus transitioned from the U.S. military strikes on Iranian nuclear sites over the weekend.
According to the Associated Press, the hope is that Iran won’t retaliate after the U.S. strikes in a manner that interferes with the global flow of crude oil, which may hurt economies worldwide, including its own.
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What are the current oil prices?
By the numbers:
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By the numbers: The Associated Press reported Monday that the price of a barrel of U.S. oil was down 0.4% at $73.56. Brent crude, the international standard, fell by 0.2% to $76.82 per barrel. Oil prices remain above where they were before the Israel-Iran conflict began, when a barrel of U.S. crude oil was close to $68.
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There is concern that if the fighting between Israel and Iran continues, it may squeeze the world’s supply of oil, which could inflate prices for oil, gasoline and other products improved from crude oil.
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RELATED: Israel-Iran war live updates: Iran considers retaliation as Trump talks regime change
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According to the AP, Iran is a top producer of crude oil, and the country may try to block access to the Strait of Hormuz off its coast. Iran uses the strait to transport its own crude oil mostly to China, and it needs the revenue made from such sales of oil.
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According to Reuters, the Strait of Hormuz lies between Oman and Iran and is the main export route for oil producers like Saudi Arabia, the United Arab Emirates, Iraq, and Kuwait.
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“If the Strait of Hormuz was completely shut down, oil prices would rise to $120 to $130 a barrel,” Andy Lipow, a Houston analyst covering oil markets, told the Associated Press, predicting that that would translate to about $4.50 a gallon at the pump and hurt consumers in other ways.
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Lipow also told the AP “It would mean higher prices for all those goods transported by truck, and it would be more difficult for the Fed to lower interest rates.”
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Trump talks oil prices
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The other side:
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President Donald Trump took to his Truth Social platform on Monday addressing the price of oil writing “EVERYONE, KEEP OIL PRICES DOWN. I’M WATCHING! YOU’RE PLAYING RIGHT INTO THE HANDS OF THE ENEMY. DON’T DO IT!”
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According to the Associated Press, the Federal Reserve has been reluctant to lower interest rates, and it’s been on hold in 2025 after cutting at the end of last year, because the agency it’s waiting to determine how much Trump’s tariffs will hurt the economy and raise inflation.
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Inflation has remained calm, and it’s near the Federal Reserve’s target of 2%, but a rise in oil and gas prices could put pressure on inflation. This may keep the Fed on hold because cuts to rates can make inflation higher, along with giving the economy a boost.
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The Source: Information for this story was provided by Reuters and the Associated Press, which cites comments from an analyst covering oil markets. This story was reported from Washington, D.C.