January 4, 2012 by staff
Iran Threats, Oil prices are gushing to eight-month highs as U.S-Iranian military tensions rise — and experts warn that the two countries’ war of words has begun to hit American pocketbooks.
“Crude-oil prices are rising thanks to the Iranians and their saber-rattling,” said Dedham fuel dealer Scott McFarlane, who boosted his heating-oil price 10 cents a gallon yesterday to $4.09.
McFarlane hiked prices after benchmark crude soared by $4.13 a barrel on the New York Mercantile Exchange to hit $102.96. That’s the highest price since May.
Oil rose after Iran test-fired a sea-based cruise missile and warned America not to send a nearby aircraft carrier into the Strait of Hormuz.
The two sides’ increasingly tough talk has pushed energy prices up on world markets in recent days — with the higher costs beginning to show up on consumers’ fuel bills.
AAA Southern New England said yesterday that Massachusetts gas prices rose 5 cents on average over the past week to hit $3.29 a gallon for self-serve regular. That’s up 26 cents from the same period last year.
“I’m expecting that we’ll see a continued rise in gas prices unless (the U.S.-Iran) situation is resolved quickly,” AAA spokeswoman Mary Maguire said.
The Massachusetts Department of Energy Resources also reported that heating-oil prices rose 2 cents a gallon to average $3.79 in the week ended Dec. 27.
McFarlane said he’s been absorbing higher wholesale prices for some time, but finally had to act.
He said the rising wholesale prices come at a time when oil dealers are already hurting from this year’s unseasonably warm winter.
“My sales are off 600,000 gallons since July 1, which is a big, big hit,” said McFarlane, a past chairman of the Massachusetts Oilheat Council. “And it’s the same story for every other oil dealer in Massachusetts.”
Teheran has threatened to close the Strait of Hormuz — where a third of the world’s petroleum transported by tankers passes — if the West approves new sanctions against Iran over the country’s suspected nuclear-weapons program.
However, Washington quickly rejected Iran’s demand that America not deploy a carrier to the area. “The deployment of U.S. military assets in the Persian Gulf region will continue as it has for decades,” Pentagon spokesman George Little said.
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