US President Donald Trump has claimed that global oil prices will fall rapidly and significantly if the United States achieves victory against Iran.
In a post on his social media platform Truth Social, Trump said gasoline prices in the United States could drop to around $3 per gallon and eventually fall below $2. One US gallon is equivalent to approximately 3.8 liters.
Trump reiterated that oil prices would decline quickly and again said Iran would never be allowed to develop nuclear weapons.
However, crude oil prices have been moving in the opposite direction amid growing concerns over supply disruptions in the Middle East.
Brent crude rose 34 cents, or 0.35 percent, to $97.34 a barrel. US West Texas Intermediate (WTI) crude also increased by $1.15, or 1.26 percent, to $92.63 a barrel.
Supply concerns grow
Fears of a prolonged conflict in the Middle East have intensified concerns about global oil supplies. Iran has warned that it would retaliate if the United States launches further attacks on its assets, raising fears that oil production and shipments could be disrupted.
Brent crude recently reached its highest level since July 24 during the previous trading session. Rising tensions surrounding the Strait of Hormuz have also prompted traders to add a higher risk premium to oil prices.
Hormuz Strait remains a key concern
The Strait of Hormuz is one of the world’s most important routes for transporting crude oil. A prolonged conflict in and around the region could therefore have a major impact on global oil supplies and push prices higher.
Trump’s prediction of sharply lower oil prices contrasts with the current market trend, where traders remain focused on the potential consequences of escalating tensions between the United States and Iran.
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