Gas prices may not drop under $3 until next year: Wright

Energy Secretary Chris Wright on Sunday said gas prices may not drop below $3 until next year, as the U.S. war with Iran and closure of the Strait of Hormuz continue to wreak havoc on energy markets.

“I don’t know, that could happen later this year, that might not happen until next year, but prices have likely peaked,” Wright said on CNN’s “State of the Union” when asked when prices at the pump will return to pre-war figures. “Certainly with a resolution of this conflict, energy prices will go down.”

Wright added that “under $3 a gallon is pretty tremendous in inflation-adjusted terms. We had that in the Trump administration, but we hadn’t seen that in inflation-adjusted terms for quite a long time. We’ll get back there for sure.”

Gas prices have spiked since the U.S. launched the war with Iran. Tehran has largely locked up the Strait of Hormuz since the war broke out, a critical shipping channel that carries about a fifth of the world’s oil.

Regular unleaded sat at $2.90 per gallon on average in the U.S. on Feb. 1, according to Gasbuddy. Since the war began on Feb. 28, gas prices per gallon have soared and are currently about $4.04 per gallon on average, according to AAA.

U.S. envoys are set to meet again with their Iranian counterparts in Islamabad, Pakistan, on Monday for talks to end the war. Oil prices tumbled late last week after the both the U.S. and Iran said the strait was opening for commerce.

But Iran fired on two tankers transiting the Strait of Hormuz over the weekend, tempering hopes that a ceasefire between the U.S. and Iran would last and that the strait would fully reopen for commerce.