Author：Currency Explorer

US President Trump said on Friday,The United States has the capability to open the Strait of Hormuz and "seize oil and make a fortune," he said, adding that this move would create an "oil well" for the world.

"Give us a little more time, and we can easily open up the Strait of Hormuz, seize the oil, and make a fortune. Will this become the world's 'oil well'???" Trump wrote on his "real social media" platform.

About 20% of the world's oil supply is transported through the Strait of Hormuz, a route that has been disrupted since the United States and Israel launched a joint military offensive against Iran.

Trump's signals regarding the US action plan in the waterway have been contradictory.

On the one hand, he claimed that the United States would "soon end" its military action against Iran, and even implied that the war might end even if the Strait of Hormuz remained unopened, showing a willingness to extricate himself; but on the other hand, he issued a strong ultimatum on social media, threatening to destroy Iran's power generation facilities if Iran reached an agreement and opened the Strait of Hormuz, demonstrating an intention to escalate the conflict.

In addition, he first demanded that allies share the responsibility of escorting ships, but after being rejected, he turned around and claimed that "the strait will open naturally," and called on other oil-importing countries to "open it up themselves," thus shifting the responsibility layer by layer.

Earlier this week, Trump urged countries, including Britain, to "go get your own oil!" adding that the U.S. "has plenty of oil." On Wednesday, in a prime-time speech, Trump declared that the U.S. is "completely independent of the Middle East" and that "we don't need their oil."

"Under my leadership, we are the world's largest oil and gas producer, not to mention we also import millions of barrels of oil from Venezuela," he said.

Can the United States really stand aside?

The hydraulic fracturing boom fueled a historic surge in U.S. domestic oil production, with Trump and his supporters touting the U.S. as an energy superpower. For years, U.S. oil production has exceeded total domestic consumption.

butThe oil market is fundamentally global.

Unlike natural gas, another key energy source, where prices can vary significantly across different regions of the world, the oil market is far more interconnected.

The Henry Hub benchmark price for natural gas in the United States is currently less than $3 per million British thermal units (MMBtu), while the price traded at the Dutch Transfer of Ownership (TTF) in Europe exceeds $16. The surge in European gas prices may not necessarily cross the Atlantic and affect the United States.

“Unlike oil, natural gas is difficult to transport,” notes Clark Williams-Derry, an analyst at the Institute for Energy Economics and Financial Analysis. “You can’t just put natural gas in barrels and then transport those barrels to another place.”

Oil price fluctuations are rarely confined to a specific region.International benchmark Brent crude has risen nearly 50% since the start of the war, breaking through $100 a barrel, and surged after Trump's national address.

“You can think of it as a giant swimming pool,” Williams-Derry said. “There will be waves or ripples, but the water level throughout the pool will rise and fall in sync. The benchmark price is determined by the global market.”

“Under current policies, becoming a net oil exporter does not shield the United States from global price trends,” he added.

While the United States does export more oil than it imports, it still imports millions of barrels of oil daily, with nearly 10% of its oil imports last year coming from Gulf countries. Many U.S. refineries are designed to process heavy crude oil, while the U.S. primarily produces light, low-sulfur crude.

The impact of energy supply disruptions caused by war with Iran extends far beyond oil.The continued paralysis of the Strait of Hormuz and the sharp rise in global fertilizer prices have forced American farmers to reconsider their planting plans. A small but crucial portion of the United States' fertilizer imports come from the Middle East.

Qatar typically supplies about a third of the world's helium, a crucial gas in semiconductor manufacturing. However, the country halted production last month—a potentially worrying sign for chipmakers and many other industries that rely on chips.

However, oil remains the most direct indicator of this turmoil. Neale Mahoney, director of the Trione Institute at Stanford University's Economic Policy Institute, stated that...Simply becoming a net oil exporter "does not particularly protect American families" from the impact of high prices.

“Due to rising oil prices, certain sectors of the U.S. economy—the energy production industry, and certain states—such as Texas, New Mexico, and North Dakota, which are major energy states—will benefit,” he added. “While this won’t protect American consumers, who will feel the pinch, there are winners and losers in the U.S..”

However, the rise in major oil stocks this year has brought little comfort to ordinary drivers at gas stations across the United States. Earlier this week, the national average price of gasoline in the U.S. broke through $4 per gallon for the first time since 2022, fueling widespread public discontent over rising costs.

“In the United States, because we produce oil and gas, when prices spike, consumers pay more and producers earn more,” Williams-Derry said.The so-called "energy independence" is essentially just a fig leaf.For low-income groups, whose livelihoods are already precarious, rising oil prices are simply unbearable.

Many sitting presidents and congressional candidates understand thatHigh oil prices could ruin an election campaign.With seven months to go before the November midterm elections, the Republican Party's control of Congress remains uncertain, and the cost of fueling voters across the country is rising.

Trump confidently believes that the people will not suffer for long, which can perhaps be summarized by the old adage: what goes up must come down. On Wednesday, he claimed, "The Strait will naturally reopen when the conflict ends," and predicted that oil prices "will fall quickly."

Mahoney, who served on the White House National Economic Council in the Joe Biden administration, is uncertain whether oil prices will fall quickly. "Retail gasoline prices exhibit the famous 'rocket and feather' phenomenon—prices rise like a rocket and fall like a feather," he said.Even with a rapid drop in crude oil prices, gas station prices are likely to remain high this spring and throughout the summer..