With international oil prices exceeding $100 per barrel as the civil war in Iran intensifies, U.S. President Donald Trump is expected to consider a series of measures to control oil prices as early as Tuesday.
The deliberations come amid growing concerns that rising energy costs could hurt businesses and consumers across the U.S. ahead of the midterm elections in November, when Republicans hope to retain control of Congress.
Strategic reserves among the options being discussed.
Officials in Washington have been exploring a number of measures to cool oil markets, including joint releases of crude from strategic reserves with Group of Seven (G7) members.
Other options being considered include limiting U.S. oil exports, intervening in oil futures markets, exempting fuel from certain federal taxes, and temporarily lifting requirements under the Jones Act that require domestic fuel shipments to move only on U.S.-flagged vessels, according to people familiar with the discussions.
Last week, the White House asked federal agencies to put together proposals that could help ease pressure on crude oil and gasoline prices. Senior officials including White House Chief of Staff Suzy Wiles and Advisor Stephen Miller will participate in the discussion.
Oil prices soar due to Iran conflict
Global crude oil prices rose to levels not seen since mid-2022, briefly reaching $119 a barrel. The surge has driven up gasoline and fuel costs since the United States and Israel launched military strikes against Iran on February 28 under what they described as Operation Epic Fury.
White House press secretary Taylor Rogers said the administration was coordinating closely with relevant agencies on the issue.
“The White House continues to work with relevant agencies as this important issue is a top priority for the President. President Trump and his entire energy team had a strong game plan to keep energy markets stable long before Operation Epic Fury began, and they will continue to review all credible options,” Rogers said.
Increased pressure due to disruption of the Strait of Hormuz
Analysts say a key driver of the surge in oil prices is the threat to oil shipments through the Strait of Hormuz, a narrow waterway between Iran and Oman that carries about a fifth of global oil supplies.
Industry experts believe the U.S. has limited tools to quickly lower prices unless tanker traffic through the Channel returns to normal.
“The problem is that the options range from marginal to symbolic to very unwise,” said one source involved in White House discussions.
The administration also sought to provide naval escort and insurance support to oil tankers transiting the Strait of Hormuz. However, these measures have so far failed to significantly increase shipping along this important global energy route.
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Based on Reuters comments