Seattle gas prices hit new record as analyst warns of $7 to $8 a gallon if Strait of Hormuz stays closed

Seattle woke up to another unwanted record Friday morning.

Patrick De Haan, head of petroleum analysis for GasBuddy, told “Seattle’s Morning News” on KIRO Newsradio that Seattle’s average gas price hit $5.79 a gallon, a new all-time record, surpassing the previous record of $5.70 set in 2022. Eight weeks into the Iran war and the Strait of Hormuz blockade, De Haan offered no optimism that relief is coming soon.

“I really hate to sit here and say there’s still not any more certainty,” De Haan said. “Don’t shoot the messenger.”

The staring contest nobody can afford

De Haan described the current standoff between the U.S. and Iran as a de facto waiting game, with both sides convinced the other will blink first.

“Iran is looking at U.S. gas prices thinking, ‘Man, President Trump is going to have to do something.’ And President Trump is saying, ‘Look at Iran, they’re running out of storage room. I just have to wait them out.’ And Iran is saying, ‘I just have to wait the U.S. out,'” he said.

Trump added to the uncertainty earlier this week by suggesting the blockade could continue for several more weeks. Yet on Friday, Trump said the war has been “terminated.” De Haan said that kind of signal from the administration tells the market a resolution is nowhere close.

“Eight weeks in, we still don’t have any resolution to this,” he said. “It’s like, let’s wait until everything just absolutely implodes and then let’s figure it out.”

In the meantime, American drivers are paying for it. De Haan estimated the nation will spend roughly $550 million more on gasoline in the next 24 hours alone compared to the start of March. Since March 1, Americans have spent an additional $20 billion at the pump.

The illusion of plenty

A JP Morgan analysis circulating this week noted that while the world has 8.4 billion barrels of oil in storage, only about 800 million of those are actually usable, a dynamic the bank is calling the “illusion of plenty.”

De Haan broke it down plainly. The global economy consumes roughly 100 million barrels of oil every day. In the last seven days alone, the U.S. exported just under 100 million barrels of oil and refined products.

“A billion barrels sounds like a lot,” De Haan said. “But when the global economy consumes 100 million barrels every day, suddenly those billions of barrels don’t really sound that significant.”

He added that commercial oil inventories, the supply the market can actually tap, could hit what analysts are calling stress levels by early June.

“These oil numbers have been within a range over the last several years,” he said. “When that range starts to really drop considerably, and you can’t really do much about it, the market tends to panic.”

De Haan used a straightforward analogy.

“It’s basically like your bank account. When you always have at least $100 in your bank account, and suddenly it drops to $50, you’re suddenly thinking, ‘Oh man,’ and you’re scrambling,” he said.

‘Completely unhinged’

De Haan didn’t soften his language when describing what he’s seeing in fuel markets right now. He called the diesel and gasoline markets, particularly in the Great Lakes region, “completely unhinged.”

His example: Two days ago in Indiana, gas prices climbed more than a dollar a gallon in four hours.

“Motorists saw gas prices literally climbing over a dollar a gallon in the time they took lunch and then the time they went home from work,” De Haan said. “That’s unhinged. The markets are telling you there’s a lot going on here. Things are bending and breaking in the background.”

What happens if the strait stays closed through September

If the Strait of Hormuz remains closed through September, analysts project oil inventories would hit their absolute floor. De Haan was asked what that means for Seattle gas prices.

“Seattle could be at $7 or $8,” he said.

He pushed back on the more extreme predictions circulating on social media. Prices of $10 or $20 a gallon are hyperbolic, he said, because long before prices reach those levels, American behavior changes dramatically. Employers allow remote work. Drivers park their cars. Discretionary driving stops.

“As you get towards $7 and $8, more consumers are throwing in the towel,” De Haan said. “When most Americans are not driving anymore, that is the threshold where prices stop going up.”

Track current Washington state gas and diesel prices at GasBuddy and AAA.

Charlie Harger is the host of “Seattle’s Morning News” on KIRO Newsradio. You can read more of his stories and commentaries here. Follow Charlie on X and email him here. 

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