American companies will be among biggest beneficiaries if crude prices average $100 per barrel this year
The United States could be one of the biggest beneficiaries of the global rise in energy prices which has resulted from the US-Israeli war against Iran, the Financial Times (FT) has reported, citing estimates provided by the investment bank Jefferies.
Oil prices have already surged past $100 per barrel due to the fallout from the ongoing war in the Middle East. If they remain elevated this year, American companies will receive a $63.4 billion boost from oil production, according to the energy research company Rystad.
Brent crude, the international benchmark, rose by more than 30 percent last Sunday, at one point topping $119 per barrel, as fears grew of a prolonged disruption to global energy supplies.
US President Donald Trump used the opportunity to pivot from a focus on keeping energy prices low to painting high oil prices as a positive. “The United States is the largest Oil Producer in the World, by far, so when oil prices go up, we make a lot of money,” he said in a Truth Social post on Thursday.
The about-face came as Trump’s team faced challenges in presenting a coherent plan for reopening the vital Strait of Hormuz for US ships. The Iranian authorities claim that the Strait of Hormuz is closed to US and Israeli ships, despite not being physically sealed with a permanent barrier.
According to The Guardian, however, more than 1,000 cargo ships, mainly oil and gas tankers, have been blocked from transiting the strait. If it remains closed until the end of the month, some analysts reckon crude could surge to $150 or even $200 per barrel, The Economist wrote earlier this week.
Rising oil prices put pressure on the US economy, as prices for gasoline and diesel fuel, as well as for many goods and services, have increased in the country, The Wall Street Journal stressed. However, the US, being a major oil producer itself, could provide the economy with protection from the worst consequences, the newspaper noted.