$100 oil? Prolonged Hormuz closure could spark a 1970s-style energy shock

[flashman13]

20. If a barrel of oil costs $100, producers can not sell gas for $3 a gallon. That's a fact.

Of course the correlation is not one-to-one. As prices rise, demand will fall. Say that is sufficient to stabilize prices at $4.50. That will still cause devastating inflation. That will ripple through an already shaky economy and an equally shaky political situation. It will destroy people already living on the edge. Of course a drop in crude oil supplies due to a Middle East cut off will have the opposite effect. In 1973 I worked in my family business which provided services to the major oil companies. I watched first hand the insanity that surrounded gas shortages. Within days of the embargo pump prices went up by 50%. In just a few weeks they doubled.

While both articles that you cite are true, they reflect what I will call the normal day to day operation of the oil economy. We are now talking about an extraordinary situation. If Middle East oil supplies are cut off by Trump's war, even for just a few days, normal goes out the window. The price of a barrel of crude will skyrocket. Serious price gouging will become a thing. Demand will also spike as people attempt to keep their tank topped off. Let's see what the oil markets do when trading reopens in just a few hours. I fueled up yesterday. You might consider doing that as well.