Trump Doubles Down on Iran War, Risking Over 600 Million Barrels of Oil

President's speech signals prolonged conflict, exacerbating global energy supply disruptions

Apr. 2, 2026 at 5:57pm

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President Donald Trump has escalated the U.S. war against Iran, spiking oil prices as traders prepare for a longer conflict that will severely disrupt global energy supplies. Trump's national address vowed to hit Iran "extremely hard," with estimates of nearly 1 billion barrels of oil and refined products lost by the end of April if the war continues. The closure of the vital Strait of Hormuz has already cut global oil supplies by 20%, and the market is bracing for further price spikes and fuel shortages around the world.

Why it matters

The prolonged U.S. war with Iran poses a grave threat to global energy security, with hundreds of millions of barrels of oil and refined fuels at risk of being lost. This will drive up prices for consumers worldwide, exacerbate inflation, and potentially lead to fuel shortages, especially in regions heavily reliant on imports through the Strait of Hormuz. The economic fallout could be severe, making this conflict a major concern for oil markets and the global economy.

The details

According to analysts, the ongoing war could result in the loss of up to 600 million barrels of crude oil and 350 million barrels of refined products like jet fuel, diesel, and gasoline by the end of April. Each additional month of conflict is expected to result in a further 450 million barrel loss. The closure of the Strait of Hormuz, which previously handled 20% of global oil supplies, has already severely disrupted energy markets. Buyers are now willing to pay a premium of $5.50 per barrel over the benchmark price to secure physical barrels of U.S. oil in Houston. Retail gasoline prices in the U.S. could surge to over $4.25 per gallon, with diesel reaching as high as $6.05 per gallon in the coming weeks.

  • President Trump's national address outlining the escalation of the U.S. war with Iran was delivered on April 2, 2026.
  • Analysts estimate that by the end of April 2026, nearly 1 billion barrels of oil and refined products will be lost due to the conflict.
  • Each additional month the war continues is expected to result in a further 450 million barrel loss of oil and fuels.

The players

President Donald Trump

The former U.S. president who has doubled down on the war with Iran, vowing to hit the country "extremely hard" and prolong the conflict.

Ryan McKay

A senior commodity strategist at TD Securities who has analyzed the potential losses of oil and refined products due to the ongoing war.

Bob McNally

The president of Rapidan Energy, who has criticized the U.S. military's response in not immediately degrading Iran's ability to disrupt the Strait of Hormuz.

Wael Sawan

The CEO of Shell, who has warned that fuel shortages will ripple around the world, starting with jet fuel, then diesel, and finally gasoline.

Natasha Kaneva

The head of global commodities research at JPMorgan, who has noted that the U.S. West Coast, particularly California, could face supply disruptions due to its reliance on imports.

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What they’re saying

“With the conflict now expected to last at least into deep April, the barrel math becomes increasingly grim.”

— Ryan McKay, Senior Commodity Strategist, TD Securities

“The speech was a disaster. The market is rapidly pricing in the impact of a prolonged war and closure of the Strait of Hormuz.”

— John Kilduff, Founding Partner, Again Capital

“I can't believe the U.S military didn't start degrading Hormuz interdiction capabilities on day one. Just as you wouldn't imagine a parachutist diving out of a plane without putting on the parachute.”

— Bob McNally, President, Rapidan Energy

“It's a ripple effect. We see of course South Asia first to get that brunt. That's moved to Southeast Asia, Northeast Asia and then more so into Europe as we get into April.”

— Wael Sawan, CEO, Shell

“Moving forward, there will be no going back to the pre-war status quo. Prices will be supported even after the war ends by new demand for stockpiling, heightened insurance and freight costs associated with the Strait of Hormuz, and a broader geopolitical risk premium in the market.”

— Matthew Bernstein, Analyst, Rystad Energy

What’s next

The U.S. military will likely need to take action to degrade Iran's ability to disrupt the Strait of Hormuz, as analysts have criticized the lack of an immediate response. Additionally, countries that rely on oil shipments through the strait will need to find alternative supply sources and transportation routes to mitigate the impact of the conflict.

The takeaway

President Trump's escalation of the war with Iran poses a grave threat to global energy security, with hundreds of millions of barrels of oil and refined fuels at risk of being lost. This will drive up prices for consumers worldwide, exacerbate inflation, and potentially lead to fuel shortages, especially in regions heavily reliant on imports through the Strait of Hormuz. The economic fallout could be severe, making this conflict a major concern for oil markets and the global economy.