Trump’s time is running out to avoid a nightmare Strait of Hormuz scenario
Rising tensions in the Strait of Hormuz and a breakdown in interim peace deals with Iran threaten to drive oil prices back toward $90 per barrel. Analysts warn that the market's expectation of a return to normalcy is likely misplaced, posing economic challenges for the Trump administration.
Why it matters
Energy market volatility in the Strait of Hormuz has direct implications for global fuel prices and U.S. domestic economic policy.
Crude oil prices plunged below $70 per barrel at the beginning of the week, and energy markets largely considered the Iran war over and done with as modest traffic flowed again through the infamous Strait of Hormuz.
But nearly 1 billion barrels of worldwide petroleum reserves are now depleted and not being replenished. At the same time, mothballed refineries have yet to come back online, China still hasn’t resumed importing large oil volumes, and now President Donald Trump has declared the interim peace deal “over” amid new drone and rocket exchanges.
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