Supply chain pressures eased in July before Hormuz flared up again

The ongoing conflict between the United States and Iran continues to roil global energy markets, with the Strait of Hormuz remaining effectively closed to commercial shipping for much of 2026. But a temporary reprieve in oil prices last week translated into lower costs at the pump for American drivers, even as analysts warn the relief may be short-lived.

Gas Prices Fall Nationally

Average gasoline prices in Missouri fell 11.7 cents per gallon over the past week to $3.67, according to GasBuddy. Nationally, prices dropped 10.7 cents to average $3.94, with declines recorded in 47 states. Diesel prices fell 5.1 cents nationally to $5.275 per gallon.hannibal

Despite the weekly decline, prices remain far above where they stood before the US-Israeli operation against Iran on February 28 that triggered the crisis. Missouri drivers are paying 81.7 cents more per gallon than a year ago, while the national average is up 85.6 cents year-over-year.hannibal

"For now, enjoy the dip, but keep a close eye on how the Strait situation develops in the days ahead," said Patrick De Haan, head of petroleum analysis at GasBuddy. He noted that oil prices edged higher in trading Sunday night, suggesting pressure on fuel markets could return quickly.hannibal

Strait of Hormuz Remains the Central Risk

The Strait of Hormuz, through which roughly a fifth of the world's oil supply typically passes, has been effectively closed for much of the year amid the US-Iran conflict. Brent crude has swung sharply in both directions throughout 2026, surging above $90 a barrel during escalations in July before falling back toward $80 to $85 as hopes for diplomatic resolution emerged.aljazeera+2

Al Jazeera reported on August 10 that oil prices climbed again as Iran's latest demands for reopening the strait dampened expectations for a near-term deal. SEB Research analysts noted that prices around $80-$85 reflect market optimism about an eventual resolution, even with the waterway still closed.aljazeera+1

Supply Chains Under Strain

The GEP Global Supply Chain Volatility Index, released August 12, showed global supply chain pressures eased in July as manufacturers scaled back precautionary stockpiling. However, the report cautioned that its survey was mostly conducted before the latest Middle East escalation, and supply shortages remained elevated by historical standards.finance.yahoo

The North America index fell to 0.76 from 1.17, while Asia declined to 1.37 from 1.95. Reports of critical items in short supply "remained high by historical standards," with production backlogs continuing to build due to missing materials and components.finance.yahoo

Reuters projected in late July that Brent would average $85.22 per barrel for 2026, with U.S. crude averaging $80.14 — well above the pre-conflict levels near $70 a barrel. A continued Hormuz closure, De Haan warned, could push the national gasoline average to its highest level ever recorded this late in the calendar year.reuters+2