Oil Hits $100 After Trump’s Iran War Escalation
The global energy market is panicking—and Americans are about to feel it
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By David Shuster
Donald Trump has long maintained a remarkable faith in the healing power of bluster. To hear him tell it, the world’s knottiest problems can be solved with a raised voice, a wagging finger, and the occasional bombing campaign. Unfortunately for the American taxpayer and the global economy, reality is less obedient than MAGA world.
The latest proof has arrived in the form of a staggering oil shock—an economic calamity as old as the modern petroleum age and just as predictable. The escalating war with Iran has rattled the global energy market like a brick through a greenhouse window.
Oil tankers are getting hit by Iranian drones and missiles, cargo insurance companies are yanking premiums, and the Persian Gulf bottleneck has caused crude prices to leap above 100 dollars a barrel. The consequences are spreading outward with the elegance of an oil slick.
The key issue involves the narrow maritime obstacle known as the Strait of Hormuz, through which 20% of the world’s oil must pass.
When militaries start fighting anywhere near that corridor (or elsewhere in the Persian gulf) the global economy tends to develops a nervous twitch. Traders panic, prices soar, and economists begin dusting off their lectures about inflation, recession, and the delicate mechanics of supply shocks.
Relatedly, we are now witnessing the exact outcome that any halfway attentive student of history might have predicted.
That’s because oil is not merely a commodity. It is the bloodstream of the modern petroleum rigged economy. Raise oil prices and the entire organism begins to wheeze.
Gasoline becomes more expensive, trucking costs climb, airline prices rise, food costs creep upward, and every factory from Detroit to Düsseldorf recalculates their margins. What begins at the oil well soon arrives, like clockwork, at the supermarket checkout.
And at this very moment, the American public is discovering a small but painful fact: Donald Trump’s geopolitical adventure in Iran is squeezing all of us with personal financial costs.
Only months ago, Dementia Don was congratulating himself on cheap gasoline, which he treated as proof of his economic wizardry. Cheap gas, in the Trump fantasy world, was the natural product of his leadership— just as sunshine was presumably the result of his morning tweets. Now that fuel prices are rising sharply, the Trump explanation has shifted.
“The United States is the largest Oil producer in the World, by far, so when oil prices go up, we make a lot of money.”
We? You mean the billionaire oil companies and their investors make a lot of money. The working class actually loses money through higher costs.
In fact for most citizens, high oil prices behave very much like a tax. Every extra dollar spent filling the tank is a dollar unavailable for groceries, rent, or the modest entertainments that make life more tolerable. When tens of millions of households undergo this small but persistent squeeze, the broader economy begins to sag. Restaurants see fewer diners, retailers move less merchandise, and the general hum of commerce drops in volume.
Economists have known this for half a century.
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In the 1970’s, the oil shocks of that time provided a frightening tutorial on how an energy crisis can produce the most unpleasant of economic ailments: inflation coupled with stagnation. Prices rise even as growth falters, leaving policymakers with the charming choice between tightening the screws or letting the patient (consumers) languish.
Yet the Trump administration appears genuinely astonished that the war against Iran has disturbed oil markets. One imagines the generals warned Trump ahead of time that bombs and oil tankers rarely coexist peacefully, prompting Trump to briefly open his eyes before falling back asleep.
Or if Trump was awake, he nodded and went back to the pressing concern of posting insults on social media.
Meanwhile, the global economy—an intricate web of supply chains and financial nerves— is reacting as it always does when the energy spigot begins to sputter.
Markets are trembling, businesses are hesitating, and governments are scrambling for emergency solutions.
And so the Trump administration has now come full circle. A war launched in the name of strength and power has prompted Orange Man and his goons to grovel and desperately hunt for additional barrels of crude.
History, of course, is repeating itself. The old lesson—that war in the Middle East carries severe economic risks—was available to anyone with an internet connection, google, and the patience to read a few pages about the twentieth century. But such sober considerations or lessons have never been a priority in Trump world, especially amidst the intoxicating appeal of swagger.
And Trump has always demonstrated that swagger is his governing philosophy.
The tragedy is that the financial consequences of this mess will not be shouldered by the architects of the Iran war. The costs will fall instead upon the people who must pay more for gasoline, groceries, and electricity while the world’s most vital energy corridor keeps getting rattled by bombs, missiles, and suicide drones.
Donald Trump may still declare victory. He has always claimed success regardless of the evidence.
But in the harsher arithmetic of economics, winning is harder to manufacture. When oil prices spike, growth falters, and household budgets strain, the verdict tends to be rendered not in political speeches but in personal financial struggles.
And for tens of millions of Americans across the political spectrum, those struggles are piling up.
Basically that transfers money almost directly from all our bank accounts much of which to Putin’s.
“To hear him tell it, the world’s knottiest problems can be solved with a raised voice, a wagging finger, and the occasional bombing campaign.”
Perhaps the only sentence I disagree with. T has never believed in solving a problem. Bluster is all he has ever believed in, with lying a close second. Both are means to his only end — accumulating money.