U.S. tensions with Iran impact oil exports and gas prices

Melissa Simon

Hang on for a minute...we're trying to find some more stories you might like.


Email This Story






Chart by Gabriel Ivan Orendain-Necochea. Photo by Mariela Molina. Info courtesy of gasbuddy.com

Gas prices have been consistently rising over the past year and as of Jan. 12, the cost of one gallon of regular unleaded gas cost $3.734, according to AAA’s Weekend Gas Watch. This price is up only one cent from the previous week, but up 15 cents from last month.

According to the Daily Fuel Gauge Report by AAA, regular unleaded gas was averaging $3.357 per gallon one year ago. This means in one year, gas prices have risen nearly 40 cents for regular unleaded. The record high for Los Angeles, which was recorded in 2008, was $4.626.

“There is no way to predict prices, but they seem to have stabilized and plateaued,” said Marie Montgomery, spokesperson for the Automobile Club of Southern California.

The rise in gas prices can possibly be attributed to the global tension, specifically between the United States and Iran, according to the L.A. Times.

Tensions began to grow when the European Union (EU) threatened to embargo Iranian oil, which would affect nearly 20 percent of the world’s oil supply. If the EU embargo was to be carried out, it would impact 18 percent of Iran’s oil export.

According to Reuters, President Barack Obama signed a defense bill on December 31, 2011 that imposed sanctions on any organization connected to Iran’s central bank, which would in turn affect oil proceeds. If this bill is completely executed, it could possibly change Iran’s ability to sell oil around the world.

In addition, Iran has threatened to close the Strait of Hormuz, which provides passage for more than 30 percent of the world’s oil, according to New England Cable News.

“The Strait of Hormuz crisis, if it ends up being a crisis, can certainly have an impact on oil prices,” Montgomery said. “These talks tend to make investors nervous and they make decisions that cause prices to go up or down depending on the economic outlook, price of the dollar and many other factors.”

The effects are wide reaching with gas prices on the rise. Students and professors alike are feeling the impact of having to pay those extra pennies every day.

Anthropology professor Christina von Mayrhauser is one of the CSUN’s faculty affected.

“I commute from South Pasadena, approximately 27 miles each way,” von Mayrhauser said.  “I use about a tank and a half a week and a significant portion of my paycheck goes towards commuting to work.”

Unlike von Mayrhauser, sophomore CTVA major Hailey Graves only has about four miles to go to school.

“It takes me about 15 minutes with traffic to get to school, but I get good gas mileage,” Graves said. “I feel like a majority of my gas is actually spent driving in circles looking for a place to park when I get to school.”

Senior family and consumer affairs major Kelli Ferguson commutes from Simi Valley, about 15 miles away.

“Gas prices impact me because no matter what the cost is, I have to pay it to get places,” Ferguson said.

Not only are undergraduate students affected but so are post-graduate students. Post-graduate first year credential student Polly Buller-Ulm works full time and goes to school.

“I commute from work to school, which is approximately 30 miles,” Buller-Ulm said. “Since I don’t work with any fellow students, carpooling is not an option so I try to schedule classes on the fewest number of days possible to reduce the cost.”

Although gas prices have been rising, many people have gotten used to the idea of the higher prices. According to Montgomery, there have been no recent calls to the Automobile Club about concerns of the prices like in the past.

“Right now, we can only go on what we’ve seen in previous years: prices go up about 20 to 50 percent in the spring, plateau in the summer and then bump up again winter and fall and drop around the holidays,” Montgomery said.

To help drivers stretch their gas as much as possible, AAA put together the Gas Watcher’s Guide to give consumers easy tips on how to save fuel and minimize costs of gas. Some of these easy tips include simply slowing down, reducing the amount of trips to run errands and lightening your load, among others.

In addition to the Gas Watcher’s Guide, Montgomery suggested AAA’s Fuel Cost Calculator.

“The fuel cost calculator is a great tool for students to budget the amount of gas they might use on trips,” Montgomery said.