President Trump urged U.S. oil producers to keep gas prices down as the Iran-Israel conflict threatened to disrupt the oil trade - but prices actually dropped Monday as a cease-fire took hold.
The stabilizing economic outlook is sure to frustrate Democrats, who want to see chaos in the Middle East drag Trump down.
Trump's demand to increase domestic production came as Iran threatened to close the Strait of Hormuz, a critically important route in the global oil trade. Roughly 20% of the world's oil passes through the strait.
"To The Department of Energy: DRILL, BABY, DRILL!!! And I mean NOW!!!” Trump wrote on Truth Social.
"EVERYONE, KEEP OIL PRICES DOWN. I’M WATCHING! YOU’RE PLAYING RIGHT INTO THE HANDS OF THE ENEMY. DON’T DO IT!”
The threat of an oil crunch seemed to fade Monday as Trump announced a cease-fire between Israel and Iran. Instead of rising, oil prices fell. The drop-off continued Tuesday.
“I love it. It dropped almost $10 yesterday,” Trump told reporters on Air Force One Tuesday morning. “We have a lot less conflict, so it came down.”
Iran's oil threats were met with some skepticism by geopolitical experts, and the United States warned that Iran would be committing "economic suicide" by choking off its most valuable export.
In a surprising move, Trump declared Tuesday that China can continue to buy oil from Iran, adding, "Hopefully, they will be purchasing plenty from the U.S., also. It was my Great Honor to make this happen!" The statement seemed to shift from Washington's longstanding policy of isolating Iran's economy. China is Iran's largest oil buyer.
The White House later clarified that Trump was referring to the Strait of Hormuz staying open and not sanctions relief.
Trump campaigned for the White House in part on combating inflation, and recent low gas prices have given the president something to boast about. But the tensions in the Middle East have led to uncertainty in the market.
The president highlighted the volatility of the situation Tuesday as he blasted Israel and Iran Tuesday for appearing to violate the peace agreement that he brokered.
“I’m not happy with them. I’m not happy with Iran, either, but I’m really unhappy with Israel going out this morning,” Trump said.
“We basically have two countries that have been fighting so long and so hard that they don’t know what the f—- they’re doing.”
