One early risk of Trump's Iran strategy is already emerging

Oil prices jumped more than 10 percent Sunday night, underscoring the political risks of President Donald Trump's military strikes against Iran. 

The main U.S. crude oil market opened at $75 per barrel in the first trading activity since the United States and Israel attacked Iran on Saturday, killing Iran’s supreme leader Ayatollah Ali Khamenei and triggering retaliatory attacks on several oil tankers traversing the Strait of Hormuz, through which more than 20 percent of the world’s waterborne crude oil passes.

Market analysts and geopolitical consultants are warning prices could remain high so long as hostilities around the Persian Gulf continue and quickly trickle down to gasoline prices at the pump — just as cost concerns take center stage in mid-term primary races.

“Everyone in the region that’s participating in the war knows that the Achilles heel of Trump is high oil prices,” said Michelle Brouhard, head of policy and geopolitical risk for Kpler, a commodity analyst firm.

Russian officials are also watching whether U.S. actions will drive up prices — to their benefit . “$100+ oil per barrel soon,” Kremlin envoy Kirill Dmitriev wrote on X Saturday. The uptick in oil prices comes as Republicans face a political reality that slightly more Americans think that Democrats are the party most committed to cutting energy prices.

The Trump administration shared a photo on social media Saturday of the White House situation room during the military strike that included Energy Secretary Chris Wright, a former oil executive, but beyond that has dismissed the risk of oil price shocks.

“I’m not concerned. I’m concerned about people’s lives. I’m concerned about long term health for this country, that’s what I’m concerned about,” Trump told reporters Friday at an event in Texas touting “American Energy Dominance,” held just hours ahead of the strikes, when asked if he was concerned about oil prices.

A quick end to hostilities would justify that confidence. Gregory Brew, a senior analyst at Eurasia Group, noted in an email that gas prices have already risen in recent weeks as the likelihood of an Iran conflict rose. He said he expected only a “short-lived” increase if the conflict ends within a few weeks.

“De-escalation will bring a rapid fall in oil prices, as was the case in [Israel’s war with Iran last] June,” Brew said. “The cost to American consumers should decline well ahead of November mid-terms — unless, of course, this turns into a more protracted affair.”

But Iran has already begun retaliating by striking oil tankers traversing the Strait of Hormuz. Trading firms that hire oil tankers are pausing shipments through the waterway given the danger, and vessels are opting to take longer — and more expensive — routes to avoid the area.