How closing the Strait of Hormuz would affect your wallet

Prices at the pump might be about to skyrocket.

Transcript

00:00Following U.S. strikes on three Iranian nuclear sites on June 21st, the world is waiting for Iran to respond.

00:07President Trump said monumental damage was done to all of Iran's nuclear sites,

00:12and the Iranian army warned that those strikes will be met with a harsh response.

00:16Now, one of Tehran's most disruptive options to strike back could be to blockade the Strait of Hormuz,

00:22which is critically important.

00:2320% of the world's oil flows through the Strait.

00:26That's about 20 million barrels of oil every day.

00:29According to the U.S. Energy Information Administration, the EIA has called the channel a critical oil choke point.

00:37Blocking the Strait would likely have a huge impact on oil prices,

00:40with analysts predicting they could spike above $100 a barrel.

00:44So far, action is muted in early trading Monday morning, with U.S. West Texas crude trading below $75 a barrel.

00:50There have been no major disruptions to the global oil supply so far,

00:54but the number of vessels navigating the Strait of Hormuz appears to be declining

00:58due to the deterioration of the security situation.

01:01That's according to CNBC, citing the world's largest shipping association, BIMCO.

01:06That'll do it for your daily briefing.

01:08From the New York Stock Exchange, I'm Caroline Woods with the Strait.