U.S. President Donald Trump said on Thursday, that neither the spike in oil prices nor the slump in the stock market during the Iran war has been as severe as he had anticipated.
Speaking during a Cabinet meeting, Trump expressed confidence in the war effort and said the economic damage would reverse over time.
Addressing Treasury Secretary Scott Bessent, the president said oil prices “have not gone up as much as I thought, Scott, to be honest with you. It’s all going to come back down to where it was and probably lower.”
Oil prices and supply concerns
Markets have whipsawed on geopolitical signals, reacting to any signs of progress or escalation in the conflict.
U.S. crude prices briefly approached $100 a barrel earlier in the war but have since pulled back, as Trump has continued to insist that the fighting will end soon. Overall, oil prices have still surged more than 40% during the conflict, pushing gasoline prices up by more than $1 per gallon.
Stock market performance
On the stock market, the S&P 500 is down 4.8% in March and about 6.5% from its record high earlier this year.
Both oil prices and stock market performance remain key benchmarks for how Trump measures economic success. He has previously criticized former President Joe Biden when gasoline prices rose sharply and has repeatedly pointed to the Dow Jones Industrial Average crossing 50,000 in early February as a milestone.
Trump has maintained that the economic damage will reverse once the war comes to an end.
“My predictions have been right,” he said.
Economic outlook and recession risks
Nevertheless, Wall Street economists have recently raised the odds of a recession over the next 12 months. Many argue that unless the war ends soon, the economic impact — particularly through inflation and higher oil prices — could lead to a contraction.
Major averages were in negative territory as Trump spoke, while oil prices rose more than 4%. Earlier in the day, Trump wrote on social media that Iranian negotiators “better get serious, before it is too late.”
