The Oil Market Is Much More Vulnerable Than Trump Believes

Peace between the United States and Iran has broken down, and the price of Brent crude oil is rising. While prices are still well below previous wartime peaks, oil markets are once again under pressure—and things are almost certain to get worse.

During the first round of the war, oil prices never reached the calamitous levels predicted by some analysts. This seems to have taught the White House a flawed lesson: that the global oil system is more robust than the doomsayers claim and that a war over the world’s most important energy chokepoint can be fought without a significant energy crisis at home.

But this is a dangerous misreading. The relative price stability of the market during the first half of 2026 rested on an inherited stock of buffers accumulated over decades: brimming inventories, untapped strategic reserves, insurance capacity, spare production, and a deep well of consumer tolerance. These are reservoirs, not renewable flows—and many of them have now been drained to a significant degree.

Now, resumed fighting, the reclosure of the Strait of Hormuz, and the Houthis’ maritime embargo against Saudi Arabia are forcing a renewed reckoning with the precarity of global oil stockpiles. With many of the critical shock absorbers expended, an escalation in oil prices will likely be much more rapid this time around.