NEW YORK (WABC) — With 20% of the world’s oil supply unable to pass safely through the Straight of Hormuz, the petrol market has been in turmoil since the war began.
But on Tuesday night, after President Trump’s announcement of a ceasefire based on the promise that oil tankers will no longer be in a chokehold, the markets responded immediately and positively.
The price of crude oil has plunged from $117 a barrel earlier in the day to below $95.
Some drivers from California were happy to pay more than $4 a gallon at the gas station in NewYork. They said they pay almost twice as much back home.
“We’re here on vacation. So $4 is actually very cheap,” a California resident said.
However, New Yorkers are not so pumped about the price at the pumps.
“Right now I’m paying $4.25 a gallon. It’s kind of crazy. A couple of months back, it was under $3. Like 280. Yeah, $2.80. It was way better,” Mohammed Halin said.
This is a welcome relief for consumers who have been hit with rising prices from basic groceries to air travel. Several airlines are announcing extra fees for checked luggage.
Even Amazon is charging a 3 and a half percent shipping surcharge for businesses whose products they deliver.
If the ceasefire holds, if Iran does open the Strait of Hormuz, will consumers feel immediate relief?
A deliveryman says the cost of filling his bike has doubled.
“Before I put $3. I work one day now is five, $6,” he said.
If history plays out, even if oil is trading at a much lower price, there is usually a delay before consumers get a break at the gas station.
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