Trump reportedly willing to end Iran war without reopening the Strait of Hormuz
President Trump told aides he’s willing to pull out of the war in Iran even if the Strait of Hormuz — through which roughly a fifth of global oil supply previously flowed — remains closed, The Wall Street Journal reported Tuesday morning.
Futures for the S&P 500 and Nasdaq 100 rose after the report. Over the past month, the closure of the strait to all but a minuscule amount of tanker traffic has sent oil prices skyrocketing and pushed major indexes down.
Trump told the New York Post on Tuesday that the war in Iran wouldn’t last “much longer” because Iran has been weakened so much already. He also said that the Strait of Hormuz would open “automatically” once the war ends, but put the onus on other countries to open the strait.
“[Iran has] no strength left, and let the countries that are using the strait, let them go and open it… because I would imagine whoever’s controlling the oil will be very happy to open the strait,” Trump told the Post.
By 11:40 a.m. ET Tuesday, the S&P 500 had risen about 1.4% and the Nasdaq Composite had risen nearly 2%.
Analysts at Signum Global, an advisory firm, told clients in a note immediately following the news that they find it “extremely unlikely” that Trump would in fact end the war without at least trying to reopen the strait. Failing to reopen the strait, Signum noted, would negatively affect the US, as well as America’s Gulf allies, and would effectively cede the strait to US rivals such as China.
Rising energy prices may soon become a domestic political and economic liability as well, with US gasoline climbing to an average of $4 per gallon for the first time since August 2022.
Trump told the New York Post on Tuesday that the war in Iran wouldn’t last “much longer” because Iran has been weakened so much already. He also said that the Strait of Hormuz would open “automatically” once the war ends, but put the onus on other countries to open the strait.
“[Iran has] no strength left, and let the countries that are using the strait, let them go and open it… because I would imagine whoever’s controlling the oil will be very happy to open the strait,” Trump told the Post.
By 11:40 a.m. ET Tuesday, the S&P 500 had risen about 1.4% and the Nasdaq Composite had risen nearly 2%.
Analysts at Signum Global, an advisory firm, told clients in a note immediately following the news that they find it “extremely unlikely” that Trump would in fact end the war without at least trying to reopen the strait. Failing to reopen the strait, Signum noted, would negatively affect the US, as well as America’s Gulf allies, and would effectively cede the strait to US rivals such as China.
Rising energy prices may soon become a domestic political and economic liability as well, with US gasoline climbing to an average of $4 per gallon for the first time since August 2022.
