Executives from major US oil companies recently delivered a blunt message to the White House: global oil inventories are draining fast, and Americans are about to feel it at the pump.

The warning, shared with senior Trump administration officials in recent weeks, paints a picture of a supply crisis driven by the ongoing conflict in Iran and disruptions choking the Strait of Hormuz. The executives described current storage levels as approaching “tank bottom,” which is the energy industry’s way of saying there’s barely anything left to draw from.

A $150 barrel is on the table

The core of the warning centers on timing. By mid-to-late June, as the US enters peak summer driving season, gasoline prices could spike considerably. Oil benchmarks, according to the executives’ assessment, could climb to $150 per barrel or higher.

Iran’s conflict, now stretching past the 60-day mark, has created serious logistical problems for global oil supply. The Strait of Hormuz, a narrow waterway through which roughly a fifth of the world’s oil passes on any given day, has been caught in the crossfire. Countries and companies have been drawing down their inventories to compensate for the lost Middle Eastern supply, but the executives made clear to the White House that the buffer is running out.

The Strategic Petroleum Reserve question

The US Strategic Petroleum Reserve currently holds approximately 357 million barrels. The US consumes roughly 20 million barrels of petroleum products per day, making the SPR a limited cushion rather than a long-term solution.

The Trump administration has been engaging with oil industry leaders on energy production and sanctions policy for months. Those earlier consultations focused on boosting domestic output and managing the geopolitical leverage that energy sanctions provide. But the tone of this latest communication was markedly more urgent.

The Iran conflict’s duration is a key variable. At 60-plus days, it has already exceeded what many analysts initially expected. Each week the situation continues, deeper inventory drawdowns push prices higher.

What this means for investors

If oil does reach $150 per barrel, transportation costs would climb, manufacturing inputs would get more expensive, and inflation would receive a significant increase. For traditional energy investors, extreme price spikes also trigger demand destruction as consumers cut back on driving and businesses absorb higher input costs.

For crypto markets, severe energy-driven inflation could push the Federal Reserve toward tighter monetary policy, which has historically been a headwind for risk assets including crypto.