Kevin Hassett, director of the U.S. National Economic Council, said oil prices will drop once the Strait of Hormuz fully reopens.
The statement addresses the global economic volatility caused by the ongoing war in the Middle East, which has restricted energy transit and inflated fuel costs for international markets.
Speaking during an interview on the Fox News program "Sunday Morning Futures" on Sunday, the 10th [1], Hassett said the current conflict has pushed the costs of oil and gas higher, creating a financial burden for both the public and private sectors.
Hassett said consumers and businesses will face higher costs in the short term due to the Middle East war. Despite these immediate pressures, he projected a shift in market dynamics once the critical shipping lane is accessible again. He said a large amount of oil will be released into the market, which will reduce prices.
The Strait of Hormuz is one of the world's most strategically important choke points, serving as the primary artery for oil exports from the Persian Gulf. Any disruption to this passage typically leads to immediate price spikes in global crude benchmarks.
Hassett said the eventual restoration of full transit capacity would counteract the current inflationary trends seen in the energy sector. The director's outlook suggests that the market is currently reacting to the artificial scarcity created by the war rather than a permanent decline in global production capacity.
“"consumers and businesses will face higher costs in the short term"”
The administration's focus on the Strait of Hormuz highlights the fragility of the global energy supply chain. By linking future price stability to the reopening of this specific maritime corridor, the U.S. is signaling that geopolitical resolution in the Middle East is the primary lever for curbing energy-driven inflation.
