A top ExxonMobil executive warned that oil prices could surge to between $150 and $160 per barrel within weeks as conflict in the Middle East drains global inventories – a spike that would likely send gasoline prices higher.
Neil Chapman, senior vice president at ExxonMobil, told investors at the Bernstein 42nd Annual Strategic Decisions Conference in New York that global inventories could reach critical lows within “two to three weeks.”
“Once you get to that point, then you’ll see price shoot up,” Chapman said, according to CNBC.
A joint statement from the International Energy Agency, International Monetary Fund, World Bank Group and World Trade Organization on Friday said global oil inventories are being depleted at a “record pace.”
The organizations said that continued drawdowns ahead of peak summer demand in the Northern Hemisphere pose “increasing risks for fuel security, market conditions, and broader economic resilience.”
The statement came as President Donald Trump met with advisers Friday to make what he called a “final determination” on a tentative memorandum of understanding with Iran that would extend the ceasefire by 60 days and reopen the Strait of Hormuz, which has been effectively closed since U.S. strikes began Feb. 28.
National average gasoline prices stood at $4.39 per gallon Friday, according to AAA. That was down from $4.55 a week earlier but up from $3.17 a year ago, before the conflict began. Diesel prices averaged $5.52 nationally.
The conflict has cost U.S. taxpayers an estimated $29 billion, according to Pentagon Chief Financial Officer Jules Hurst, who updated the figure during testimony before a House Appropriations subcommittee on May 12. The estimate was up from the $25 billion projection he gave lawmakers two weeks earlier.
Trump, speaking at a Cabinet meeting Wednesday, said the administration was “not satisfied” with the terms of the proposed agreement.
“Either that, or we’ll have to just finish the job,” Trump said.
