Oil Standoff With Iran

Iran threatens to choke off a major gateway for the world's oil supply.
1:20 | 12/29/11

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Transcript for Oil Standoff With Iran
Iran is starting now for a second time to choke off that major gateway to the world's oil supply in the Strait of Hormuz. And we are learning this morning -- there is already a major US military presence right there. It's a standoff that may also be felt in your wallet with concerns that gas prices could potentially reach five dollars per gallon by this summer. Let's get the very latest on the diplomatic part of the story from ABC's Cecilia Vega who's at the White House this morning to -- good morning. Good morning Elizabeth yes tensions are definitely heating up in this region with -- Ronnie and saying on state television they have spotted a US aircraft carrier in near these very important waters. The United States is saying that aircraft carrier is there for the -- Afghanistan not in response to these threats from Iran unless these threats coming from around -- common the past. Never before been carried out on analysts though say if in fact they are carried out this time the consequences. Could be dire to this world already fragile economy raising oil prices to prices never before seen. This region this waterway carries about 40%. Of the world's. Oil shipments that's about 15 of the world's global supply a very important waterway -- -- and say shutting it down would be easier than drinking a glass of water. Elizabeth these waterways again a very contentious point right now the US not backing down saying -- any closures will not be tolerated.

This transcript has been automatically generated and may not be 100% accurate.

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