Secretary of Energy Chris Wright on Thursday didn’t confirm or deny whether oil would hit $200 a barrel as gas prices continue to surge and the conflict in Iran has escalated to a global economic crisis.
CNN International host Becky Anderson spoke with anchor and correspondent Eleni Giokos about how the U.S.-Israeli strikes in Iran have prompted Iran to block the Strait of Hormuz and strike back at the international oil market. Iran has signaled that it aims to spike oil prices to $200 a barrel.
“I think it basically contradicts a lot of what we heard from the Energy Secretary, and we know he was asked about whether oil is going to hit $200 a barrel,” Giokos said. “He couldn’t definitively say no and I think that’s very telling about where we are and also, quite interestingly, when he was asked about naval escorts, he says we were not ready for that yet, it will happen at the end of the month, but hang on, we thought this was hopefully going to end by the end of the month, which obviously isn’t the timeline that’s realistic.”
The International Energy Agency’s 32 member countries agreed on Wednesday to release 400 million barrels of oil to help lower energy prices amid the Iran war oil supply disruption.
“The IEA says this is the largest disruption of supply — ever — in the oil markets, and I think we really need to take that seriously,” Giokos said. “We’re talking about 8 million barrel deficit, despite the fact that they’ve released a record number of oil from emergency reserves-400 million barrels. But again, that was supposed to just sort of inject a little bit of confidence in the market. It’s not doing that. Oil prices right now are high and you’ve got the futures in the US also under pressure. It’s really indicative of the seriousness of this energy shock that is heading home.”
President Donald Trump and his administration’s changing rhetoric around oil prices also hasn’t stopped prices from climbing, Giokos explained.
“Six tankers and cargo ships over the last few days have been hit by Iran, and that’s really indicative of the seriousness of Iran’s threats,” Giokos added. “They also said that they warned the world, they promised they’re going to keep on choking the Strait of Hormuz, but they also warned that oil prices are going to hit $200 a barrel, and that is what leverage they have. They have leveraged to inflict pain on infrastructure here, which they are doing. Oman and Bahrain depots are on fire. We’ve seen those images today and they’re disrupting trade as well.”
The disruption has appeared to have left consequences for the global market.
“We’re looking at some of those images as we face at present, and so when Chris Wright was asked by our colleague Kate, you know whether you can see prices going to 200 bucks on the barrel, and he couldn’t answer that, he was right not to answer it,” Anderson said. “I mean he doesn’t like the idea. You can’t answer that question because nobody can at this point. 200 bucks on the barrel would be significantly catastrophic for these markets around the world.”
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