Topline
President Donald Trump issued a warning to keep oil prices down in a cryptic Truth Social post Monday that comes amid fears oil and gas prices could surge if Iran retaliates against U.S. strikes by shutting down the Strait of Hormuz.
President Donald Trump returns to the White House prior to a meeting with his National Security … More
The Washington Post via Getty ImagesKey Facts
“Everyone, keep oil prices down,” Trump said in an all-caps post, writing “I’m watching! You’re playing right into the hands of the enemy. Don’t do it!”
It’s unclear who Trump was referring to, but it’s possible he was addressing oil producers.
In a subsequent post directed at the Department of Energy, Trump wrote “DRILL, BABY, DRILL!!! And I mean NOW!!!”
The Energy Department does not drill for oil, but manages the Strategic Petroleum Reserve and provides research and policy support related to oil production, among other industry-adjacent functions.
Oil prices were flat Monday following the U.S. military’s surprise attacks on three Iranian nuclear facilities over the weekend, but analysts warned prices could surge if Iran retaliates by closing the Strait of Hormuz, a key transportation route for oil and gas that links the Persian Gulf to the Arabian Sea.
Big Number
30%. That’s how much oil prices could rise, to up to $110 per barrel, if Iran moves to close the Strait and oil flow declines 50% for at least one month, Goldman Sachs cautioned Monday. Prices for international oil were flat Monday at $77 per barrel by 10 a.m. EDT.
Key Background
Iran has vowed to respond to the attack, with its Foreign Minister Abbas Araghchi tweeting early Sunday that it “reserves all options,” calling the attack “outrageous” and vowing that it would “have everlasting consequences.” Iranian parliament has approved a plan to potentially shut down the Strait, Iranian state media reported after the U.S. attacks Saturday. A quarter of global oil and 20% of liquefied natural gas is transported through the 90-mile waterway, according to The New York Times, which notes most of the oil that passes through the Strait goes to Asia. Iran would likely shut down the Strait by lacing it with mines, requiring the U.S. military to engage in a potentially dangerous demining operation, The Times notes.
Further Reading
Rising Oil Prices Could Spike Another 30% If Iran Blocks Strait Of Hormuz, Goldman Warns (Forbes)
U.S. Strikes Iran: ‘Suspicious Package’ Halts Miami Metro As U.S. Cities On Alert (Forbes)
Trump’s Strike On Iran Draws Criticism From Democrats—World Leaders Call For De-escalation (Forbes)
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