Oil prices increased early Thursday, reaching their highest levels since the beginning of the U.S.-Iran conflict, but then decreased following reports suggesting President Trump might soon resume military actions against Iran.
The cost of a barrel of Brent crude, a global benchmark, climbed to over $126 just after midnight ET. This spike occurred after President Trump indicated he would continue a blockade of Iranian ports in the Strait of Hormuz.
“A blockade is genius, isn’t it? A blockade is 100% foolproof,” the president commented to journalists in the Oval Office on Wednesday, asserting that Iran needed to simply concede defeat. “Now they have to shout ‘uncle’. That’s all they have to do: ‘We give up.’
However, Brent prices later dropped to around $116 per barrel. Reports from Axios noted that Adm. Brad Cooper, commander of U.S. Central Command, would be briefing President Trump on Thursday about plans for short but effective military strikes designed to pressure Iran into renouncing its nuclear pursuits.
The president suggested on Wednesday morning that he thought the blockade might be “somewhat more effective than bombing,” but specifics about when any new military action would take place remained unclear.
“They’re suffocating like stuffed pigs, and it’s going to get even worse for them,” Trump told Axios.
He added, “They want to reconcile. They don’t want me to continue the lockdown. I don’t want to do that. Because we don’t want them to have nuclear weapons.”
Since April 8, the U.S. and Iran have been in a ceasefire, although President Trump has continuously threatened further military intervention to push for progress in indirect peace negotiations.
At the same time, the average price of regular gasoline climbed to $4.30 per gallon on Thursday, a rise from $4.03 just a week prior, as retailers contend with disruptions in global energy supply chains.
Jerome Powell, the outgoing Federal Reserve Chairman, defended the decision to keep interest rates steady, acknowledging that rising gas prices are a burden for many Americans. “I’m very aware that people across the country are experiencing higher gas prices right now, and that’s painful,” he stated.
He warned that these price increases could affect other sectors too, such as airfare and products tied to oil derivatives, meaning people might soon feel the broader impact of these changes.
