Consumers struggling with higher gas prices as a result of the Iran war may wonder: with talk of negotiations toward a potential ceasefire, how long would it take to feel relief if the conflict ends?
Since the war began nearly a month ago, gas prices have spiked as a knock-on effect of higher oil prices.
“If you’re low on gas, I’d fill up because I don’t think you’re going to see a resolution of this in the next three or four, five days,” says Jon Allen, a senior fellow at the Bill Graham Centre for Contemporary International History at the University of Toronto.
“I think if there’s going to be a negotiation, it’s going to take some time.”
About 20 per cent of the world’s supply of crude oil has been choked off in the Strait of Hormuz, a vital shipping channel in the Persian Gulf region that Iran has been using for leverage by threatening any ships allied with the U.S. and Israel that try to pass through.
At one point during the conflict, some crude oil prices reached nearly US$120 per barrel.
Amid the volatility of ceasefire proposal talks and Iran’s rejection of the U.S. proposal on Wednesday, the price has continued to fluctuate but hovers around $90 as of publication.
“Energy markets are famously volatile and it has always been impossible to predict where things will go because it’s a market where small changes in supply can have big changes in price, and a lot hinges here on how long that lasts,” says Trevor Tombe, a professor of economics at the University of Calgary.
Get breaking National news
“We see big moves in oil prices up and down, sometimes just depending on what the president tweets one day or another. So it’s really hard to see where we go from here, but it does look like oil prices have fallen a lot in the past couple of days, just on the prospects of potential peace.”
Where does the Iran war stand now?
On Wednesday, Iran dismissed the idea that the war could pause, let alone end anytime after receiving an American proposal for a ceasefire.
That came after Trump said on Tuesday that the U.S. was “in negotiations right now” with Iran.
At the same time, the Associated Press reports that at least 1,000 U.S. troops are being sent to the Middle East in the coming days.
All of this uncertainty means consumers shouldn’t expect gas prices to come down anytime soon because the future of the Middle East conflict, and more specifically the reopening timeline for the Strait of Hormuz is unclear.
“These things change every day,” says Allen.
“Donald Trump can say whatever he wants, and he can offer whatever he wants, but if Iran doesn’t like it, they’ve got a stranglehold on the Strait of Hormuz.”
When it comes to negotiations between the U.S. with Israel and Iran, Allen says, “they’re pretty far apart.”
This means the war may not be ending anytime soon, and even if a proposed ceasefire or end to the war is in the works, consumers may be paying for the conflict for weeks or even months after. That’s because there is a lagging effect that higher prices for resources like oil and fertilizer can have on prices consumers wind up paying for things like gas and groceries.
“A lot does depend on how long oil prices remain high for. For food, you typically see a six to nine month lag between producer cost changes and consumer price changes,” says Tombe.
“If oil prices do fall back to where they were, and I don’t believe anyone’s predicting that will occur, then instead of seeing affordability ease, we’ll just avoid affordability worsening.”
–with a file from the Associated Press
Days? Months? before we see gas prices come down!? Let’s talk years. With the USA threatening a full ground invasion of Iran and no agreement in site with Iran the USA is heading into another Afghanistan conflict with little hope of winning a conclusive victory against a 1 million strong Iranian army!
Ariel is a lying Liberal communist treasonous trash. Calling him or it a journalist is a joke and an insult to all journalist in the FREE world.
Carbon Carneys Carbon tax to enrich the elite and steal from the now poor is directly linked to Canadian over priced gas.
Nothing for environment it profit for Brookfield and his scumbag liberals attacking democracy and western society.
Supply chain issues, Tariffs, war, weather…
How about industrial carbon tax, government spending and waste?
We are getting hosed! Any excuse to keep prices high !! Oil and gas industry is as crooked as Clown Carneys Band of thieves !!!
Let’s be realistic. There’s ALWAYS an excuse why the prices are so high in all sectors including food and everything else. Our politicians think Canadians are stupid and don’t know what’s going on. It’s a system built on greed!!! That’s it, that’s the clear reason. When the economy is good nothing goes down. We’re just modern day slaves but not allowed to talk about anything without being under some official threat. Just a matter of time before they cru
Fuel is still cheaper in B.C. than it was when the terrorists had their carbon tax added to it
Russianj trolls…lol…should be in Ukraine
What I really need relief from is not gas prices (I don’t presently, nor ever will own, a car), but from my herpes, contracted from some serious azz pounding with Roy Stephenson.
My Charlie Kirk alternate personality posting here is, like my main personality, a low-IQ, white guilt stricken, TikTok educated, w oke joke. I will never be successful in life, and I suspect my parents, who I still live with, have written me out of their will in favour of my neighbours pet poodle.
We had a choice between Iran dropping nukes on us or a temporary rise in fuel prices…..and considering that 1/2 of the country can’t figure out if they are male or female, I’m glad that Trump went ahead and made the correct decisions for you.
It’s insane to see that some idiots oppose this war. Iran is a horrific country and excute anyone that goes against their regime. This is a war that have been 30+ years in the making. People from Iran are celebrating the collapse of their “government” yet the stupid white liberals are the only ones opposed.
Jesus H. Christ Almighty, the U.S, the E.U. and Israel should just obliterate Iran. They’re never going to change; so just get rid of them. People like the Iranian regime and Hezbollah, have no place in this world; so why in hell are they here?
Like most ignorant white Christian men I agree with the guy pretending to be Roy Stephenson. Then again I’m a sheep that will blindly follow my white Christian president even though he’s a ped0phile. Then again I’m dead so it doesn’t really matter what I think. Oh well 🤷🏻
If you’re b r a i n d e a d like Bob you wouldn’t know about the autrocities & civil rights violations Iran has committed over the last 30 years. If you’re normal of course you will understand why the regime had to be stopped.
Let’s kindly not forget – Iran is under no expectation to surrender or talk. The USA and Israel started it – they are the ones who need to stop. Stop painting Iran like a demon when it’s the other way around. Luckily most people see this now.