How the Situation in Iran is Affecting Indiana Gas Prices

A car filling up with gasoline at a gas station showing a close up of the pump in the gas tank from a side view. — Source: (PHOTO: CHAIWATPHOTOS/Getty Images

STATEWIDE–Gas prices are going up all across Indiana and throughout the country due to the volatile nature of the situation in Iran.

Patrick DeHaan, head of petroleum analysis at GasBuddy, says this is because there is elevated risk as Iran threatens vessles that need to travel through the Strait of Hormuz.

“That is a waterway that sees almost 20 to 25% of the world’s oil supply flowing through it. Iran has de-factor shut down the Strait with these threats. Very few ships want to take the risk of going through the Strait. That is driving up the price of oil,” said DeHaan.

He says most gas stations in Indiana are charging around $3.29 per gallon.

“We’ve already seen quite the jump at the pump. We could see another jump later this week. That would be rare to see two price cycles in one week, but it would depend on how the situation evolves in the Middle East,” said DeHaan.

But if all that’s being made are threats, DeHaan argues that those threats are not limitless.

“Eventually the market will see the rhetoric if there is no backing there. Eventually, I could see the U.S. or oil producers being forced to act to secure the Strait of Hormuz to allow the shipment of oil through it,” said DeHaan. Once the shipment of oil moves through, DeHaan believes prices will begin coming back down.

Even when prices rise, DeHaan says he does not expect $4 per gallon gas in Indiana anytime soon, but you may see prices at the pump jump to roughly $3.49.