Analysts say attacks on energy sites in the Middle East deepen the threat to the US economy

The US-Israeli war with Iran led to a rise in gasoline prices as the fighting clogged an important waterway for global oil delivery. However, shoppers expressed hope for the reopening of the Strait of Hormuz and a relatively quick recovery.

Industry analysts told ABC News that tit-for-tat attacks on oil and gas sites across the Middle East in recent days have closed that glide path, as repairs could last for months and reduce fuel supplies in the meantime.

They added that the possibility of a long-term oil shock increases the risks facing the US economy, threatening to deal a blow to families already suffering from high inflation and a near-frozen labor market.

“Both sides have taken the gloves off when it comes to attacks on infrastructure — and this is just bad news for everyone,” Severin Bornstein, a professor of business and public policy at the University of California, Berkeley, told ABC News.

Iran launched a series of retaliatory strikes against critical energy infrastructure in neighboring Gulf states after Israel struck its largest gas field the previous day.

Among retaliatory strikes, Iran struck the world’s largest liquefied natural gas terminal at Ras Laffan in Qatar – the most serious attack on the country’s energy facilities since the start of the war.

In an effort to lower oil prices, the Trump administration announced the release of the Strategic Petroleum Reserve, the easing of sanctions on Russian oil and the suspension of a major regulation of domestic oil transportation, among other measures.

Recent attacks on energy sites pushed global crude oil prices as high as $119 a barrel on Thursday, before oil gave up some of those gains, hovering around $109 a barrel by Friday afternoon. Even after their decline, oil prices recorded a staggering rise of more than 50% over the past month.

Gasoline prices in the United States stand at $3.91, up 98 cents from the previous month. AAA Show data.

At the same time, the rapid rise in diesel prices threatens to raise the costs of groceries, clothing and almost every other product, because diesel is the lifeblood of the American supply chain.

Some analysts said attacks on oil infrastructure risk exacerbating fuel shortages and prolonging a potential bout of inflation, which would strain household budgets and reduce economic output.

“Even if hostilities end immediately, it will take some time to repair those facilities and return to full capacity,” Timothy Fitzgerald, a business economics professor at the University of Tennessee who studies the oil industry, told ABC News. “The longer key input costs continue to rise, the greater the pressure on the entire economy.”

Inflation is at 2.4%, a decline from previous months but still slightly above the Federal Reserve’s target rate of 2%.

The Iranian attack on the Qatari LNG terminal in Ras Laffan threatened the facility from which a fifth of the world’s liquefied natural gas is usually shipped, according to the US Energy Information Administration.

In a statement, the Qatari Ministry of Foreign Affairs condemned the attack and described it as a “dangerous escalation.”

The attack reduced Qatar’s ability to export liquefied natural gas by 17%, and cost it an estimated $20 billion in lost annual revenue, according to Qatar Energy, the state-owned oil company. The company said repairs are expected to take up to five years.

Iran also struck energy sites in Israel, Kuwait, and the United Arab Emirates, among other countries in the region.

Bornstein warned that energy shortages could put pressure on economic production around the world.

“If you have less oil and gas, the global economy is able to produce less stuff,” he said. “The economy slows down.” “The more damage there is, the more difficult it will be to get the global economy moving again.”

To be sure, the United States economy retains a greater ability to withstand a global oil shock than other countries, because the United States is a net exporter of oil, meaning it produces more oil than it consumes. But oil is sold on the global market, which means that U.S. oil and gasoline prices remain sensitive to fluctuations in supply and demand around the world.

Some analysts said repairs at energy sites likely won’t begin until hostilities end and work sites are secured. They also warned that ongoing political tensions could lead to higher prices after the war ends and energy sites are repaired.

“Even if these facilities are rebuilt, there is no guarantee that they will not be attacked again,” Robert Weiner, a professor of international economics at George Washington University, told ABC News. “Going forward, this will raise the level of uncertainty,” he added.