US fuel exports have surged to record levels as Europe and Asia rely on American energy to offset shortages caused by the war with Iran, the Financial Times reports, according to UNN.
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According to the latest data from the US Energy Information Administration, more than 8.2 million barrels per day of refined fuel, including gasoline, diesel, and jet fuel, were shipped abroad from the US last week, an increase of more than 20 percent compared to the same period last year.
The surge in overseas purchases is bringing significant profits to US energy companies, which could earn an additional $60 billion this year if prices remain high.
But it also threatens political blowback for US President Donald Trump as domestic gasoline prices rise, with the average price of gasoline hitting a four-year high of $4.53 a gallon, the publication writes.
While the White House has repeatedly stated it will not ban fuel exports, which have become a key lifeline for European and Asian economies, energy industry analysts believe domestic political pressure could force a rethink of that position.
"The situation is getting worse for the administration," said Robert Yawger, a commodities specialist at Mizuho Securities. "If the price of gasoline hits $5, they may have to resort to an export ban."
Jeff Currie, senior energy advisor at private equity firm Carlyle, said the scale of exports means US oil inventories are being drawn down rapidly to meet overseas demand. US diesel inventories are at their lowest level in 20 years.
"A shortage doesn't start when supply stops," Currie said. "It starts when inventories are depleted."
Last week, massive US energy demand led to America becoming a net exporter of oil for the first time since World War II, a sharp reversal of the US position from just over a decade ago when it was one of the world's largest oil importers.
The US and Israeli war with Iran has effectively closed the Strait of Hormuz for the past two months, cutting off about a fifth of the world's oil supply and causing the largest oil supply disruption in history.
Oil prices fluctuated sharply on Wednesday, with the price of benchmark Brent crude at one point falling from $109 a barrel to $97 after Donald Trump suggested the US military campaign would soon end and the strait would be open to all.
Oil traders sold off sharply amid hints of a peace deal, in case the 100 million barrels of oil currently in the Persian Gulf are released onto the market.
The price of Brent crude then rose back to $101 a barrel. Iranian officials said they were considering the latest US proposal but dampened any expectations of a breakthrough that would end the conflict.
The Iranian news agency Tasnim, linked to the influential Revolutionary Guard, said the proposal contained some "unacceptable provisions."
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An Iranian diplomat told the Financial Times that the latest US proposal includes a 30-day "confidence-building" period during which there would be a "simultaneous" opening of the strait and lifting of the blockade, followed by more detailed discussions on the nuclear program.
Iran had previously insisted it would not resume negotiations until the US lifted the blockade of Iranian ports.