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Gas prices rise as US, Iraq spar over strategic oil route

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Fast Eddie


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WASHINGTON (AP) -- Gas prices in Hampton Roads took a big jump this week - more than 10 cents at some stations - and tensions between the U.S. and Iraq are to blame.

"I think it's due to the threat of reduction of oil exports from Iran. Basically, we're seeing our retailers having a knee jerk reaction to that potential," said AAA spokeswoman Georjean Blumling.

The U.S. is describing the threat as nothing but "bluster."

An Iranian official is quoted by the country's official news agency as saying if the West imposes sanctions on Iran's oil shipments, Iran will close the Strait of Hormuz -- through which 40 percent of the world's oil supply passes.

A State Department spokesman calls it "another attempt by them to distract attention from the real issue" -- which he says is Iran's "noncompliance with international nuclear obligations."

The West is considering limiting Iran's oil trade because of its disputed nuclear program. About 80 percent of Iran's foreign revenue comes from oil exports.

The price increase isn't going unnoticed by drivers.

"It really hits me in the wallet," said one man.

"I'm actually pretty annoyed," said another.

Iran says one of its surveillance planes has shot video and photographed a U.S. aircraft carrier during an Iranian drill near a strategic waterway in the Persian Gulf.

The official IRNA news agency on Thursday quoted Rear Adm. Mahmoud Mousavi as saying this shows Iran's navy is "observing moves by foreign forces" in the area.

IRNA's report didn't provide details or say which U.S. carrier was filmed. It's unclear what value such footage could have.

Iran is holding a 10-day military exercise in international waters beyond the Strait of Hormuz -- the passageway for one-sixth of the world's oil supply.

A spokeswoman for the U.S. Navy's 5th fleet is warning Iran that any disruption of traffic flowing through the Strait "will not be tolerated."

"Anyone who threatens to disrupt freedom of navigation in an international strait is clearly outside the community of nations; any disruption will not be tolerated," said Fleet spokeswoman Lt. Rebecca Rebarich.

She said the U.S. Navy is "always ready to counter malevolent actions to ensure freedom of navigation."

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