Gasoline costs have fluctuated recently but trended lower across much of the United States, a development welcomed by many drivers. The ongoing conflict involving Iran has already added more than $40 billion in expenses for motorists nationwide, prompting some to explore electric vehicles as an alternative. Yet this shift may not ease broader market strains, according to reports from Oil and Gas Journal.

At the Bernstein Strategic Decisions Conference, ExxonMobil senior vice president Neil Chapman told investment bankers that oil prices could increase by an order of magnitude within two to three weeks once inventories reach critically low levels. Chapman noted that releases from strategic reserves have so far cushioned the impact of roughly 14 million barrels per day in disrupted Middle East output. He added that dated Brent crude could climb to $150 or $160 per barrel once those buffers are exhausted.

The most important factor in the price of oil and associated products will soon be the releases of inventories that, along with distributions from countries strategic petroleum reserves, have mitigated some of the effects of the Iran conflict taking offline or shutting in about 14 million b/d of Middle East production. We are approaching unheard of inventory levels. I mean, really, really low levels. You can debate whether that is going to hit those really low levels in two weeks or three weeks. Once you get to that point, you will see price shoot up.

Chevron Executive Shares Similar Outlook

Chevron chief executive Mike Wirth echoed these points, emphasizing that sanctioned supplies from Russia, Iran, and Venezuela have helped offset lost production from Kuwait and the United Arab Emirates. He warned that remaining buffers are being steadily drawn down and that upward pressure on physical prices will become more evident through June and into July.

These assessments align with recent International Energy Agency cautions but project a shorter timeline for significant effects. With major oil executives expressing greater concern than some external analysts, attention now turns to diplomatic efforts aimed at restoring access to the Strait of Hormuz, though any resolution may arrive too late to prevent further price increases.