On Sunday, Energy Secretary Chris Wright said worries about a shutdown at the Strait of Hormuz are overblown, arguing shipments are still moving and that the jump in prices is being driven by anxiety rather than missing supply. His comments come as oil at $140 has been floated as a worst-case outcome if Iran were able to choke off the route that carries roughly 20 million barrels a day.
Speaking with Fox News, Wright pointed to a large tanker that had already transited the strait without incident and said U.S. military action is reducing Iran’s ability to attack shipping with drones and missiles. Wright also said energy “will flow soon,” while stressing the U.S. is acting carefully.
In the same interview, Wright told Fox News host Shannon Bream that the price move wasn’t tied to a lack of oil or gas barrels, calling it a market reaction to uncertainty about whether the conflict becomes prolonged. He also argued the U.S. is in a strong position because it exports both crude oil and natural gas and is coordinating with allies.
Why Energy Secretary’s Confidence Surprises Analysts
That reassurance lands against a backdrop of stark scenario planning from analysts at ING, who have warned that a forced closure of Hormuz could quickly lift ICE Brent into the $80 to $90 range, with paths toward $100 and even $140 if disruptions persist. In that framework, the market shock is less about a single headline and more about the duration and scale of any supply losses.
ING also flagged knock-on risks for natural gas, arguing European gas and Asian LNG could see sharper moves if Qatari cargoes are interrupted. The firm said TTF gas could jump to EUR 80 to EUR 100 per megawatt-hour, which it translated to about $28 to $35 per MMBtu.
Wright, however, framed the U.S. response as a mix of security and logistics, describing a “pragmatic decision” to redirect some Russian crude that was sitting offshore in Asia into Indian refineries to speed availability of products in the region. He said the move didn’t represent a policy shift toward Russia, but rather an effort to accelerate transactions he suggested were likely anyway.
Economic Fallout From Prolonged Conflict
This perspective aligns with warnings from economist Peter Schiff, who has previously discussed that a prolonged conflict with Iran could cost the U.S. over $1 trillion, significantly impacting inflation. He emphasized that the financial burden would stem from both military expenditures and government borrowing, potentially causing inflation to “skyrocket” as resources are strained.
Moreover, economist Mohamed El-Erian cautioned that the longer the conflict continues, the higher the risk of supply chain disruptions, which historically have not fared well under sudden shocks, potentially exacerbating the energy situation in the region.
Could Iran Conflict Spark Oil Prices Surge?
Separate market chatter has also focused on infrastructure vulnerabilities, including unconfirmed claims of strikes near Iran’s Kharg Island export facilities, a node that could affect about 1.5 million barrels per day largely headed to China. Israel has also shut the Leviathan and Karish gas fields, impacting roughly 17 billion cubic meters of annual output.
As reported by Thehill, Wright argued the U.S. view is that the world has ample energy supplies and that the current premium reflects fear rather than a physical squeeze. He also said the administration is keeping in touch with allied countries as the situation develops.
President Donald Trump added a deterrence note on Truth Social, warning Iran not to target the U.S. and writing that “they better not do that,” while also threatening retaliation with “a force that has never been seen before.” Those statements came as the risk of wider military escalation remains central to how traders are pricing the next steps.
How Geopolitical Tensions Impact Global Energy Flow
Beyond crude, the Hormuz corridor is a key artery for LNG as well, with more than 100 billion cubic meters a year moving through the passage, making any sustained disruption a multi-market event. ING’s analysis suggested gas could react even more violently than oil if buyers start assuming a longer outage window for Gulf exports.
Wright’s argument is that shipping is still getting through and that U.S. and allied actions are limiting Iran’s capacity to sustain attacks on commercial traffic. Separately, prediction markets tied to U.S.-Iran diplomacy have shown bettors assigning the highest probability to a nuclear deal timeline of “Before 2027,” at 58%, up 17 percentage points.
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