A Crisis That Refuses to Resolve on Schedule
The continued closure of the Strait of Hormuz has pushed crude oil prices into territory that, only weeks ago, seemed implausible. West Texas Intermediate now sits above $104 a barrel and Brent above $108, and these are not the numbers anyone expected when the disruption was first described as a matter of a few days or a few weeks. Twelve weeks ago, the idea of sustained WTI above $104 would have struck most observers as far-fetched. Even a personal ceiling estimate of $110 a barrel now looks conservative: the more sober analytical voices are warning that, should the situation persist, prices could climb toward $175 or even $200.
The pressure point is Iran. The country is running out of places to store the oil it cannot move, which means it is being squeezed toward some kind of agreement. The alternative — shutting down its production complex entirely — is economically unattractive enough that it is unlikely to be chosen voluntarily. So the central question is not whether this resolves, but when.
There is a comforting assumption circulating that the moment the strait reopens, prices will fall back immediately. That assumption deserves skepticism. We may be standing at, or very near, a tipping point — not merely a price spike but a structural shift in who holds crude, who produces it, who depends on it, and how quickly supply can be redirected to where it is needed. This is an extraordinarily dynamic moment. The picture at noon may look materially different from the picture at breakfast.
The Scale of the Disruption
The Strait of Hormuz historically carried roughly 20 million barrels of oil per day. Around 14 million of those barrels are currently not being replaced. Measured another way, more than 1.1 billion gallons of crude oil have been lost since the event began. Because the global market runs with supply and demand matched on a day-to-day basis, with little slack, this is not a shortfall that can be absorbed quietly. Strategic reserves will eventually need refilling, and that demand sits on top of an already tight system.
An American View Versus an International View
The most important distinction in reading this crisis is that the American experience is fundamentally different from almost everyone else's. Nations that depend heavily on someone else's oil are exposed in a way the United States and Canada are not. Americans are paying more for gasoline and diesel, but there is little realistic prospect of physically running out of fuel.
Elsewhere the story is harsher. India, deeply reliant on propane, natural gas, and diesel, is operating hand-to-mouth, day to day. Cuba has physically run out of gas, leaving its population without electricity for something on the order of 22 of every 24 hours. Most of the world will survive this episode, but it will pay considerably more to do so. The shock is real and significant; its severity is simply distributed unequally.
The U.S. response has been to pull every available lever to soften the impact. Gasoline blending rules — normally seasonal, with a different summer and winter formulation — are being adjusted to bring more butane into the mix. The Jones Act has been waived twice to ease the movement of fuel. And the relationship with Venezuela now looks markedly different from what would have been contemplated six months ago. New alliances are taking shape in real time, reordering energy relationships that once seemed fixed.
Why Natural Gas and Propane Insulate the United States
What truly separates the American position is its abundance of natural gas and propane. Consumers are not paying meaningfully more for either, even as oil-linked fuels climb. These two commodities are so plentiful domestically that the country can export record volumes and still retain record volumes for home use without pushing up the price. The infrastructure to capitalize on this is already built: the pipeline mains are in place, the supply is in place, and the ships needed to move product around the world are in place.
This is why propane's global role is poised to expand. The industry has done the unglamorous work of building out infrastructure and logistics, so the question facing customers is no longer whether the supply exists but how to put it to use today.
The Larger Story: Electricity, Data, and Demand
Beyond the immediate conflict lies a structural trend that will outlast it: America's growing thirst for electricity, driven by the relentless quest for more data and compute. The surge of chip-related public offerings is one visible signal of this. Behind it is a quieter contest over how to power the build-out — a competition between diesel fuel on one side and natural gas and propane on the other.
Data centers are central to this. The primary facilities are increasingly looking at natural gas to generate their own power. Where natural gas mains do not reach, the conversation turns to propane as the practical alternative. The same logic that has long applied to natural gas is now being applied to propane in a serious way. A recent transportation industry gathering featured more discussion of natural-gas- and propane-fueled vehicles than has been heard in the past decade — a telling indicator of where momentum is heading.
A Dynamic Period Ahead
The next two to three months will be turbulent, both in the United States and around the world. But it would be a mistake to frame this purely as an Iran story. The underlying drivers — explosive data center growth, rising industrial demand, and the formation of new energy alliances — are bigger than any single chokepoint. The Hormuz disruption may be the trigger, but the deeper transformation is a realignment of global energy power, and the nations with abundant, deliverable supply are the ones best positioned to define what comes next.