Low fuel inventories could cause gas prices to surge this summer, oil and gas executives have told the Trump administration, according to reports.
Energy industry leaders have been warning White House officials that rapidly shrinking fuel inventories could trigger a sharp spike in oil and gasoline prices if disruptions tied to the conflict with Iran continue, The Washington Post reported Thursday.
Industry executives reportedly have sounded alarms that commercial stockpiles and government reserves used to cushion supply disruptions are falling toward critical levels just as the peak summer travel season gets underway.
"We're sounding the alarm on these inventories going to record lows," American Petroleum Institute CEO Mike Sommers said in comments cited by the Post.
The concerns come as the Trump administration intensifies pressure on Iran.
President Donald Trump on Thursday vowed additional military action and said the United States would target key Iranian oil infrastructure, including Kharg Island, Tehran's primary oil-export terminal.
The administration has argued that sustained military and economic pressure is necessary to force Iran to abandon its nuclear ambitions and end threats to global shipping routes.
The Strait of Hormuz, through which roughly one-fifth of the world's oil supplies normally pass, remains at the center of the dispute.
Energy executives told both The Washington Post and Politico that prolonged disruptions in the region are steadily draining inventories around the world.
One industry executive told Politico inventories were already at "dangerously low levels" and warned policymakers that markets could face serious pressure in the coming weeks.
Some analysts have projected that if stockpiles continue to fall, oil prices could jump significantly, potentially pushing gasoline prices above $5 per gallon in some regions.
Others note that markets have remained more resilient than expected thanks to reserve releases and increased production elsewhere.
The Trump administration has pushed back on the more dire forecasts.
White House officials have highlighted record U.S. oil production, releases from strategic reserves, and policy moves such as waiving restrictions under the Jones Act to ease transportation bottlenecks.
Officials also note that average gasoline prices have fallen from recent highs as markets reacted to reports of potential negotiations.
Politico last week reported that administration officials continue to monitor inventory levels closely while maintaining that the United States remains in a strong position.
Many energy experts agree that the key variable remains the duration of the conflict.
If shipping through the Strait of Hormuz returns to normal, price pressures could ease.
If disruptions continue into late summer, however, inventories may tighten further and increase the risk of higher costs for American consumers.
For now, the White House appears focused on achieving its broader strategic objectives against Iran while balancing the economic concerns that come with prolonged instability in one of the world's most important energy corridors.