In January, the United States invaded Venezuela — a country with the largest oil reserves on Earth. Gas prices that week? Two dollars and eighty-one cents. They barely moved. Because despite all those reserves, Venezuela produces less than one percent of the world's oil. Reserves don't set prices. Production does.

Then the U.S. and Israel struck Iran. Iran choked off the Strait of Hormuz — and roughly a fifth of the world's oil supply stopped flowing. Crude prices jumped forty-five percent. Gas shot past four dollars.

Here's the thing: eighty percent of that oil was headed for Asia, not the United States. We get almost none of our oil from the Persian Gulf. But it didn't matter. Oil is priced on a world market. When supply drops anywhere, prices rise everywhere — including at your gas station in Wisconsin.

That's what "global commodity" means. And no amount of drilling changes it.

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Why Venezuela didn't move gas prices: Venezuela has the largest proven oil reserves on Earth — roughly 17% of the global total. But production has collapsed from 3.5 million barrels per day in the late 1990s to under 1 million bpd by 2025, due to years of mismanagement and sanctions. When the U.S. intervened in January 2026, gas averaged $2.81/gallon nationally. Markets barely reacted because Venezuela's actual production — not its reserves — is what matters, and it's less than 1% of global supply. (Bipartisan Policy Center; The Conversation)

Why Iran moved gas prices dramatically: U.S. and Israeli strikes began February 28, 2026. Iran blocked the Strait of Hormuz, disrupting roughly 20 million barrels per day — about 20% of global oil supply. Crude jumped approximately 45% to $95-100/barrel. The national gas price forecast for 2026 rose to $3.70/gallon (up from $3.10 in 2025). (EIA Short-Term Energy Outlook, April 2026; Resources for the Future)

We barely import from the Persian Gulf — but it still affects us. The U.S. imports only about 490,000 barrels per day from Persian Gulf countries — roughly 8% of total imports. About 80% of oil flowing through the Strait of Hormuz is headed to Asia, not the U.S. But oil is priced on a single global market. As energy economist Mark Finley of Rice University's Baker Institute put it: "If something goes wrong anywhere, the price goes up everywhere." (FactCheck.org)

The U.S. is the world's largest oil producer at roughly 13.8 million barrels per day. Yet we're still a net importer of crude — importing about 6.2 million bpd and exporting about 4 million bpd. Record production didn't prevent the price spike. (Poynter/PolitiFact)

Related Civic Minute segments: What's in a Gallon of Gas (CM-22), Does Drilling More Lower Gas Prices? (CM-24), What Energy Independence Actually Means (CM-38)