As the Iran War entered its second week of major combat operations, crude oil prices continued their massive spike, briefly surging above $119 a barrel — currently at $92 a barrel as of this writing — as more than a hundred oil and natural gas tankers remain stranded in the Persian Gulf, still unwilling to cross the Strait of Hormuz into the Gulf of Oman.
But, President Donald Trump promises, the price spikes will be temporary and come down as soon as the war is over, but are worth it in any event, writing on Truth Social on March 8, “Short term oil prices, which will drop rapidly when the destruction of the Iran nuclear threat is over, is a very small price to pay for U.S.A., and World, Safety and Peace.”
And so, security comes first, with the President vowing to do what it takes to eliminate this enemy, with the costs at the gas pump — now above $3.40 a gallon from less than $3 prior to the offensive beginning — are secondary to the safety and security of the U.S. and our allies, and to achieving the objectives the President has set forth. In short, Iran cannot have a nuclear weapon.
As for prices, there have been several geopolitical-driven oil price spikes: the 1973-1974 Arab Oil Embargo, the 1979-1980 Iranian Revolution and Iraq-Iran War start, the 1990-1991 Gulf War, the 2003-2011 Iraq War, the 2011 Libya Civil War and Russia’s invasion of Ukraine in 2022.
Some of the oil shocks lasted longer than others. Following the 1973-1974 Arab Oil Embargo, oil went from a little more than $4 a barrel to over $11 a barrel where it remained all the way through 1979, rising to more than $14 a barrel even after the embargo ended as OPEC kept production lower, when the Iranian Revolution began. Then it shot from almost $15 a barrel to more than $39 by June 1980, not correcting until mid-to-late 1980s.
The 1990-1991 Gulf War was faster, with oil rising from almost $17 a barrel in 1990 to $35.90 a barrel by October 1990, correcting to $19.86 by March 1991.
The Iraq War, which was authorized in fall 2002, say oil rising from $29 a barrel in December 2002 and amid rising demand by China, kept rising throughout the entire war, topping off at $133 a barrel in June 2008.
Similarly, when the Arab Spring and Libya Civil War broke out in 2011, oil prices rose from $89 a barrel in January 2011 to $110 a barrel by April 2011, back to $85 a barrel by September but then kept clanking between those two all the way through 2014 as sanctions increased on Iran, when U.S. shale production finally broke the cycle and prices collapsed.
Finally, the post-Covid production cuts led to a massive spike from a little more than $19 a barrel in April 2020 to more than $75 a barrel by December 2021, right before the Ukraine War expanded in February 2022, rising to $114 a barrel by May 2022 and not falling back to $68 a barrel until May 2023.
So, arguably, the 1990-1991 Gulf War, the 2011 Libya Civil War and the Russian invasion of Ukraine were the shortest-lived price spikes, with corrections following about a year later. That’s what “temporary” looks like in the history.
Whereas the other episodes, it was about 12 years of higher oil prices when one combines the Arab Oil Embargo and Iranian Revolution price shocks and 6 years in the case of the Iraq War. So, more like 72 months apiece for each of those episodes.
Meaning, if the current price shock is short-lived, it could be about a year before everything returns to normal, or it could be several years. In any event, with the 2026 Congressional midterms rapidly approaching, it likely won’t do President Donald Trump and Congressional Republicans much good to predict price spikes to be temporary. Whether the price spikes are short-lived or years-long, relief will likely not be felt until after November.
Therefore, the administration should prepare the American people for a high economic cost. Which can lead to a high political price on top of everything else this year and perhaps into 2028, depending on how long the pain is felt in an environment where the economy and inflation have already remained the top voting issues for four years now. It’s an issue where urgency is desirable but reality has a way of grinding you up, with no president is immune to inflation’s political ruination. Just ask Gerald Ford who served during the Arab Oil Embargo, Jimmy Carter who served during the Iranian Revolution, George H.W. Bush who served in the Gulf War and Joe Biden who served during the Russian invasion of Ukraine. They were one-term presidents.
The other two examples were George W. Bush and Barack Obama, both of whom were reelected in 2004 and 2012 despite the oil price spikes and recessions early in their terms. Bush still had high enough approval following the terrorist attacks of Sept. 11, 2001 in New York City, the Pentagon and Pennsylvania, and Obama had managed to recover just enough of his approval by 2012 following a rocky first term to eke out Mitt Romney.
So, in recent history, oil shocks have destabilized economies and ultimately politically destabilized presidencies about 66 percent of the time. The two times it didn’t, the presidents were still benefitting from high enough positive approval.
Politically, that’s not a great spot to be in, but that’s the history. If we should foresee a potentially high political price on the horizon, then the President should be weighing the consequences of not finishing the job now as it relates to Iran, which could be quite high when we consider our weak sister opposition party in Democrats who originally negotiated the Iran nuclear deal of 2015.
Today, going into the U.S. strikes that began on Feb. 28, oil was around $65 and has already surpassed $100 a barrel, up $45 a barrel, as Iran has attacked Gulf state oil and gas infrastructure and is threatening to attack ships in the Strait of Hormuz.
The President has stated the objective is to destroy their missile and missile production capacity, their nuclear weapons and nukes production capacity, sink their navy and destroy their air force including the drones, and to make it impossible for them to export terrorism.
But the regime may not be ready to crumble despite Ayatollah Ali Khamenei being killed in early air strikes. Now, a new Ayatollah has been named, Mojtaba Khamenei, the son of the old Ayatollah. The state there could be resilient even after the recent protests and crippling military strikes that have largely destroyed Iran’s navy, air force, missile and drone capacity.
The opposition in Iran either has the capability to wage an offensive or it does not. It sounds like they need help. The protesters who were being massacred in the tens of thousands recently did not appear to be fighters, though, and did not appear to pose any kind of military threat to the Islamic Revolutionary Guard Corps.
We are not receiving reports of any kind uprising from within in the wake of the U.S. and Israeli strikes. There does not appear to be a ground offensive in what we’re told is actually a very limited window of opportunity for opposition forces to claim power while the U.S. and Israeli air and naval strikes are ongoing.
The National Council of Resistance of Iran named a provisional government but they remain in exile in France and Albania.
The President has publicly ruled out the Kurds.
A lot of comparisons have been made to Libya, but there, there were anti-Qaddafi ground forces numbering in more than 200,000 that the U.S. air and naval campaign supported until they were successful.
Governments of large countries sometimes can collapse from within but that’s usually something that takes years and even decades, for example, in Russia and the Soviet satellites. And there, the prerequisite was that the governments had to cede power and be unwilling to massacre their own people. Mikhail Gorbachev kept the army in the barracks in Russia as a relatively peaceful transfer of power occurred, with similar standdowns in Poland and East Germany. Whereas, Iran has already recently demonstrated the capacity to murder its own citizens, who were defenseless.
Brutal regimes maintain power via brutality. They can be externally defeated but usually at great cost, and it does not usually happen overnight. If all the Allies had done in World War II was bomb Nazi Germany, the Third Reich wouldn’t have easily fallen. Territory ultimately had to be removed on the ground to make it happen.
Politically, although the President does appear to be keeping his options open, the American people have been told repeatedly by the administration there will be no ground forces in this operation and it will end soon.
If so, all the Mullahs might have to do is wait for the shooting to stop and then begin reconstituting regional power. Will we have gotten all the missiles and drones? How quickly can those be rebuilt after the operation ends?
What about the nuclear weapons materials? U.S. special envoy Steve Witkoff told Fox News’ Sean Hannity that in his last interactions with the Iranian negotiators, they were claiming to still have enough nuclear material to make nuclear bombs even after the June 2025 Operation Midnight Hammer: “Both the Iranian negotiators said to us, directly, with, you know, no shame, that they controlled 460 kilograms of 60 percent, and they’re aware that that could make 11 nuclear bombs, and that was the beginning of their negotiating stance.”
That could pose quite a dilemma. How long until all of the nuclear materials can be secured? The unconstitutional War Powers Act says military campaigns without Congress can last 60 days to 90 days but when do wars ever end that quickly against rather large countries? They usually don’t that quickly — unless they’re unfinished.
In the meantime, the enemy’s weapon appears to be to target or merely threaten to target energy production and distribution to spike prices. As it is, hundreds of tankers are anchored and refusing to cross the Strait of Hormuz and appear ready to stand put until major combat operations are over. But we’ve been told to expect weeks not days. We have to see what happens when tankers eventually try to go through the Strait, which will be the moment of truth. If Iran cannot close the strait, then traders will eventually price in that Iran can no longer threaten oil exports out of the region, eventually calming the situation.
So far, U.S. and Israeli military actions have been devastating but also limited to air and sea, and we are told will end soon enough. The President has proven to be quick and decisive, and has repeatedly stated he does not want a long-term military commitment.
If so, one question will be what’s left of Iran’s regime and its capacity to disrupt oil production going forward, and then does it want to change its approach after the death of the Ayatollah.
It might be about this time that the President should be seriously contemplating simply finishing the job — especially given the economic and political costs of the war already being baked into the cake. It could very well be that no president will never get a better opportunity to end threat posed by Tehran once and for all than what is at play right now. The alternative could be to let the enemy to crawl away, eventually get back up off the mat and still be quite dangerous.
The President has said he is looking for the regime in Tehran to be completely defeated, resulting in unconditional surrender, either formally, or because there were no leaders left to surrender. But with the new Ayatollah, what are the consequences if Iran is able to crawl away from this? Are they sufficiently degraded?
The President should do what he believes is right to protect U.S. interests and national security given a clear-eyed approach. There is a significant likelihood of both high economic and political costs directly coming from the war that might be unavoidable. We therefore have to win decisively by finishing the job. Good luck, Mr. President, and God bless our troops.
Robert Romano is the Executive Director of Americans for Limited Government Foundation.
