Spectrum News 1: “Why Is the Strait of Hormuz Affecting the Price You Pay at the Gas Pump?”
RFF Fellow Daniel Raimi comments on the global nature of oil prices.
“‘The world oil market is global, and this is something that Americans often don’t appreciate,’ said Daniel Raimi, a fellow at Resources for the Future and a lecturer at the University of Michigan. ‘And I think that’s largely because politicians have continued to talk about this term of energy independence, which is really misleading to consumers.’ A global oil market means global oil prices. That means Americans are affected by bottlenecks—and yes, war—even when that oil will never touch U.S. soil.
‘When there’s disruption in the Strait of Hormuz, it doesn’t just affect oil prices going through the Strait of Hormuz,’ Raimi said. ‘It affects oil prices everywhere because oil is relatively easy and cheap to move around.’”
