Energy markets do not usually recover at the speed politics promises. That is the core of The New York Times report on the fallout from the war with Iran. Even if Trump succeeds in stopping the fighting within the deadline he set for himself, American households and businesses may not feel real relief in energy costs for weeks, and perhaps months.
Markets have already sent a clear signal of that concern. Brent crude is hovering around $100 a barrel, up about 40% since the war began, while the average gasoline price in the United States has approached $4 a gallon after rising by nearly $1 in a single month. The effects of that shock could linger well after the guns fall silent.
Detail
The problem lies in what the war leaves behind across supply chains, shipping routes, and production itself. Even if the Strait of Hormuz reopens, shipping traffic will not return immediately. Passage through a zone that has just emerged from military confrontation is also likely to keep a risk premium built into prices.
On top of that, some regional production has slowed or stopped in recent weeks, whether because of full storage tanks, security risks, or drone attacks. Restarting fields and facilities, and restoring exports to a normal rhythm, will take time. That is what makes any drop in prices gradual rather than sharp.
The pressure is also uneven across fuel types. Diesel and jet fuel appear more likely to remain elevated for longer, opening the door to higher air and land shipping costs, and in turn passing the burden into everyday goods, food prices, and summer travel.
Economically, this shock is landing on a U.S. economy that was already under strain. Inflation and the labor market had shown signs of weakness before the war, meaning that prolonged high energy prices could deepen the slowdown and perhaps push the economy closer to recession if the crisis drags on.
What next?
Even in the best-case scenario, the market does not appear ready to hand Trump a rapid and steep decline in prices. The more likely path is a slow retreat that begins only after production and shipping recover part of their normal flow, but without a quick return to prewar levels. That means the political and economic fallout of the war may outlast the fighting itself.
