Stocks jumped and Brent crude prices plunged Tuesday after the US signaled a deal to reopen the Strait of Hormuz could be imminent, but the drop is unlikely to translate to immediate relief at the pump.
US President Donald Trump castigated oil majors for not doing more to bring down gas prices, after ExxonMobil, Chevron, and others reported blowout earnings.
But unlike oil futures, which fluctuate “based largely on traders’ vibes,” retail fuel prices are mostly baked in, Semafor’s Tim McDonnell argued: US refineries are stretched to their limit, and operators elsewhere have been unable to satisfy demand, as Ukraine continues to strike Russian energy facilities. If Hormuz disruptions persist, JPMorgan analysts predicted, US gasoline prices will rise back above $4.20 a gallon.