Gasoline prices in PR climb as Mideast conflict tightens global oil supply

The increase in fuel prices, already visible at local gas stations, reflects Puerto Rico’s exposure to international price shocks driven by geopolitical instability in the Middle East.

By THE STAR STAFF

Gasoline and diesel prices in Puerto Rico rose sharply this week as the ongoing conflict involving Iran continues to disrupt global oil markets, pushing crude and refined fuel costs higher worldwide.

The increase, already visible at local stations, reflects the island’s exposure to international price shocks driven by geopolitical instability in the Middle East.

Luis Guiets, president of the Puerto Rico Gasoline Retailers Association, said Wednesday in a radio interview that petroleum costs have been climbing steadily because of the conflict, and the impact is now evident at the pump. According to the Department of Consumer Affairs (DACO by its acronym in Spanish), regular gasoline is selling for $1.06 to $1.12 per liter, premium for $1.20 to $1.29, and diesel for $1.33 to $1.36. But Guiets warned that diesel prices in particular have surged in recent days.

“The product most affected over the past weeks has been diesel. Diesel reached 140 cents in cost,” Guiets said, noting that limited distillate supplies and high refining margins have made the fuel especially vulnerable. He added that stations receiving deliveries on Wednesday were forced to post higher prices: regular gasoline between $1.10 and $1.13 per liter, premium at about $1.29, and diesel jumping to between $1.45 and $1.46.

The spike in Puerto Rico mirrors global trends. Since late February, when the U.S.-Israeli conflict with Iran escalated, energy markets have been rattled by disruptions in the Strait of Hormuz, a critical chokepoint through which roughly a fifth of the world’s seaborne oil and gas flows. The conflict has constrained oil supplies and triggered sharp increases in crude and refined product prices worldwide. In the United States, gasoline prices rose 24.6% year-over-year in July, according to federal data, largely driven by the same supply shocks affecting Puerto Rico, according to news reports.

The Iran conflict has also severely strained global refining capacity, keeping gasoline and diesel prices elevated even as crude benchmarks have fluctuated. European diesel prices have climbed more than 70% since the war began, while U.S. gasoline prices are up 60%, reflecting a widening gap between demand and refineries’ ability to meet it, according to news reports.

The International Energy Agency reports that wholesale gasoline and diesel prices remain about 30% higher than before the conflict, even after crude prices eased slightly following a tentative mid‑June agreement to reopen the Strait of Hormuz. The surge in refined product prices has been especially pronounced due to the loss of Middle Eastern heavy crude, which yields higher volumes of diesel and jet fuel.

In the United States, the war has pushed average pump prices above $4 per gallon for the first time in more than three years, marking the steepest monthly rise in decades. Analysts attribute the increase to Iran’s closure of most shipping through the Strait of Hormuz, which has driven U.S. oil futures above $100 per barrel.

Guiets cautioned that if crude prices continue their upward trajectory, Puerto Rican consumers should brace for additional increases. With global supply still constrained and refined product markets under pressure, the island, which imports all its fuel, remains highly vulnerable to external shocks.

“The trend is upward,” Guiets said. “If this continues, consumers will keep seeing higher prices.”