Oil prices surges to record high as war in Iran disrupts global supply due to escalating conflict.
According to Associates Press, oil prices spiked near $120 per barrel before falling back on Monday, March 9, as the Iran war intensified, threatening production and shipping in the Middle East and pummeling financial markets.
The price for a barrel of Brent crude, the international standard, surged to $119.50 per barrel early in the day but later was trading at $107.80 per barrel.
West Texas Intermediate, the light, sweet crude oil produced in the United States, spiked at $119.48 per barrel but fell back to $103 per barrel.
The war’s toll on civilian targets grew as Bahrain accused Iran of striking a desalination plant vital to drinking water supplies, and oil depots in Tehran smoldered following overnight strikes by Israel.
Oil prices have surged as the war, now in its second week, ensnares countries and places that are critical to the production and movement of oil and gas from the Persian Gulf.
Prices moderated after some members of the Group of Seven industrial nations were considering releases of strategic oil reserves to alleviate pressure on the markets. The unconfirmed report cited unnamed people familiar with the talks.
How high oil prices can impact your daily life:
Spiking oil prices have drastic impacts on other everyday expenses, including general transportation, groceries, household goods, utilities, and more as everything is linked to other.
Here are things that will be affected by increasing oil cost amid Middle East conflict.
Transportation cost:
The most obvious impact of higher oil costs is higher fuel costs. Whether you have your personal vehicle or you travel in public transport your commute cost will also get higher.
Similarly, airplane fuel also becomes more expensive that directly impacts the ticket's price. Shipping and trucking companies also face the same issues.
Food and grocery prices:
Oil costs can indirectly impact food and grocery prices in a few different ways.
Apart from the fuel used to transport food from the farm to your table, oil is often used to power farm and factory equipment, and it’s a key ingredient in many fertilizers and pesticides, as well as plastic food packaging.
Home heating and propane:
The cost of crude oil directly affects heating oil and propane prices. Heating oil prices are up $0.160 per gallon from a week ago and $0.406 since last year, and while the average cost per gallon for residential propane is down, there were modest increases across the East Coast.
