Smoke was still rising over the port of Fujairah on the morning of May 28, 2026, when tanker captains in the Gulf of Oman began rerouting. Hours earlier, a coordinated Iranian barrage of cruise missiles and armed drones had slammed into one of the UAE’s largest oil export terminals, igniting fires visible from commercial shipping lanes and triggering missile-alert sirens across the Emirates, the Associated Press reported, citing regional military officials.
The United Kingdom Maritime Trade Operations (UKMTO), the British naval authority that monitors Gulf shipping, confirmed at least two vessels were burning off the UAE coast. Within hours, the U.S. military announced operations to secure passage through the Strait of Hormuz, the 21-mile-wide channel that the U.S. Energy Information Administration estimates carries roughly 21 percent of the world’s petroleum liquids and a major share of global liquefied natural gas trade each day.
The national average price of gasoline climbed to $4.46 a gallon, according to AAA. Analysts at Moody’s warned that if the Strait remains effectively closed into June, retail gas could hit $5 a gallon, a level the U.S. has not sustained since the summer of 2022. “A prolonged closure of Hormuz, even a partial one, reprices every barrel that touches the Gulf,” a Moody’s credit analyst noted in the firm’s late-May 2026 energy risk assessment, adding that the $5 threshold assumes weeks of restricted flow with no offsetting production surge from OPEC+ spare capacity.
Why Fujairah matters beyond the fireball
Fujairah is not just another port. It sits on the Gulf of Oman, outside the Strait of Hormuz, and exists specifically so tankers can load crude without transiting the chokepoint. Striking it sends a pointed message: Iran is willing to threaten energy exports even at terminals designed to bypass the Strait. That calculation widens the risk map for insurers, shippers, and refiners worldwide.
It also has a recent precedent. In 2019, four commercial vessels anchored off Fujairah were damaged by limpet mines in an attack the U.S. attributed to Iran but that Tehran denied. The May 2026 strike is far larger in scale and far less ambiguous in method, involving missiles and drones rather than covert sabotage.
Brent crude surged past $95 a barrel in overnight trading after the attack, while West Texas Intermediate jumped above $90, according to Reuters market data. Both benchmarks had already been elevated by regional tensions, but the Fujairah strike pushed them to their highest levels since late 2023. For American refiners that depend on Gulf-sourced crude, the spike translates directly into higher wholesale costs that flow to the pump, the grocery aisle, and the airline ticket counter.
What American drivers and households face
At $4.46 a gallon, a family filling a 16-gallon SUV tank pays roughly $71 per fill-up, about $13 more than the national average at the start of the year. That increase lands just as summer travel season ramps up, compounding costs for road trips, daily commutes, and the freight carriers that stock store shelves. Diesel, which powers most long-haul trucking, has tracked gasoline higher, so the pain extends well beyond the pump.
The Moody’s $5 scenario hinges on specific conditions: the Strait stays closed or severely restricted for weeks, and no major producer offsets the lost barrels quickly enough. Saudi Arabia and other OPEC+ members hold spare capacity that could partially compensate, but mobilizing it takes time, and spare crude cannot replace the liquefied natural gas volumes that also flow through Hormuz. If shipping lanes reopen quickly or diplomatic channels produce a ceasefire, prices could settle below that threshold.
But uncertainty alone is expensive. Fuel wholesalers and airlines are already locking in hedges at elevated prices, baking higher costs into contracts that consumers will feel through the summer regardless of what happens next in the Gulf.
The natural gas ripple
Qatar, the world’s largest LNG exporter, ships the bulk of its cargoes through the Strait. A sustained closure would tighten global LNG supply at a moment when European and Asian buyers are competing for every available cargo ahead of the next heating season. U.S. benchmark natural gas prices are driven mostly by domestic production and storage levels, and the EIA’s weekly storage reports show inventories near the five-year average. Still, international LNG disruptions can redirect cargoes away from U.S. export terminals, alter contract pricing, and create secondary pressure on domestic markets over the weeks ahead.
What triggered the strike, and what remains unknown
Iran’s government has neither claimed nor denied the Fujairah attack. Attribution to Iranian cruise missiles and drones rests on AP reporting and the UKMTO assessment, not on Tehran’s own statements. The broader context matters: the strike follows months of escalating friction tied to the collapse of nuclear diplomacy and recent Israeli military operations in the region, though no direct provocation has been publicly identified as the trigger.
Several critical facts remain unresolved. The full extent of damage at the Fujairah facility has not been disclosed by UAE authorities. A quick recovery would point to a short disruption; deeper structural harm could constrain export capacity for months and drive up insurance premiums at every Gulf terminal.
The status of the Strait itself is also unclear. The U.S. operation to secure passage is confirmed, but whether the waterway is fully blocked, partially restricted, or simply contested by Iranian naval assets is a distinction that available reporting does not yet resolve. A partial restriction and a total blockade produce very different supply outcomes for crude oil and LNG alike.
How the Strait of Hormuz standoff shapes fuel costs through June
The confirmed facts are stark: an Iranian strike hit a major UAE oil port, energy benchmarks spiked, and the world’s most important oil chokepoint is under active military contention. Everything beyond that, including the duration of the disruption, Iran’s next move, and the precise trajectory of fuel prices, depends on decisions still being made in Tehran, Abu Dhabi, and Washington.
For consumers, gasoline prices are elevated now and carry real upside risk through June. AAA’s daily national average and the EIA’s weekly petroleum status reports offer the clearest real-time read on whether the $5 scenario is materializing or fading. The Strait of Hormuz has been threatened before without a prolonged closure. But the Fujairah attack marks the first time in decades that a state actor has struck a Gulf oil terminal with this kind of firepower, and global markets are pricing that reality in barrel by barrel.
Vince Coyner is a serial entrepreneur with an MBA from Florida State. Business, finance and entrepreneurship have never been far from his mind, from starting a financial education program for middle and high school students twenty years ago to writing about American business titans more recently. Beyond business he writes about politics, culture and history.
