At roughly $109 a barrel for Brent crude and about $4.10 for a gallon of gas in the US, energy prices feel high.
They are high. But, and here is the crux, they are not historically extraordinary, not by a long shot. Yet how those prices are framed matters, because it shapes how the public reacts and how policymakers respond.
And right now, the war and Iran’s moves to close the Strait of Hormuz, though with each deadline set and then extended, more ships are being allowed through, are widely being framed as something that could have a “lasting” impact on the global economy.
“The war has killed thousands, sparked an energy crisis and threatened lasting damage to the world economy,” read a Reuters report on Saturday, reprinted widely in newspapers around the world.
Yet “lasting” is a long time, and perhaps more than the situation, serious as it is, actually justifies. This is not the first time oil prices have spiked. The shock can be sharp, the impact real. But for it to be lasting, the disruption itself would have to last, over many months, not days or weeks, and that is not what we are seeing.
Markets adjust. Supply finds its way, whether through the release of strategic reserves or the rerouting of shipments, and demand eases. What feels like a jolt often proves just that: a jolt.
The numbers, taken without historical context, suggest crisis. History suggests something more measured.
Adjusted for inflation, today’s oil prices remain well below the peaks of both 1980 and 2008, when prices climbed into the $140–$150 range in today’s dollars.
In 1980, prices surged after the Iranian Revolution and the Iran–Iraq War disrupted supply; in 2008, they spiked as booming global demand, led by China, outpaced what producers could supply.
Gasoline prices tell a similar story. At just over $4 a gallon, Americans are paying roughly what they did, again, in real terms, during the spikes of 2008, 2011–2012 amid the Arab Spring, when Libyan production went offline, and in 2022 following Russia’s invasion of Ukraine. Painful, yes. Unprecedented, no.
This context is lacking in much of the coverage and commentary on the war and its economic impact. Energy markets have always moved in cycles: sharp spikes driven by geopolitical shocks, followed by adjustment, shifts to alternative supplies, and, eventually, decline. What we are seeing now fits that pattern.
None of this suggests that the economic costs of the war are not real. They are. But they are not, at least not yet, as apocalyptic as some of the coverage suggests.
US President Donald Trump appears to understand this. In a March 9 Truth Social post, he wrote that “Short term oil prices, which will drop rapidly when the destruction of the Iran nuclear threat is over, is a very small price to pay for USA, and World, Safety and Peace. ONLY FOOLS WOULD THINK DIFFERENTLY!”
The argument is clear: the pain is temporary; the payoff is permanent. But that message is not being sufficiently amplified.
Nobody would accuse Trump of Churchill-style rhetoric. His tone can veer in the opposite direction, coarse and laced with insults. Yet the underlying logic he invoked in that March 9 post, though definitely not the style, is one Winston Churchill would have recognized: that the public may be asked to bear a cost in pursuit of a larger, historic goal.
Churchill captured that idea more directly, urging the British people on June 18, 1940, in his famous “Their Finest Hour” speech, to “brace ourselves to our duties” in the face of an immediate threat. The expectation of hardship was clear.
Trump, in far less elevated language, and about something far more mundane, gasoline prices, is making a related argument: that a temporary burden is worth bearing for a larger strategic objective.
The difference, however, is not only in tone but also in context.
In 1940, the Nazis were marching through Europe and were at Britain’s doorstep. The threat was immediate, existential, and visible. Britain stood alone. Under those conditions, the willingness to bear hardship, to pay the cost, was not merely rhetorical; it was a necessity.
The US today faces a different reality. Iran is far away. Its threat, while serious, is not immediate. It is not close to America’s shores. And distance matters.
Churchill was asking his people to bear a heavy burden for a tangible threat bearing down on them. Trump is asking Americans to bear a relatively light burden for a threat they do not yet tangibly feel. Sacrifice is always easier to rally when the danger is close and unmistakable. It is harder when the threat is abstract, the costs are real, and the connection between the two must be explained rather than felt.
The gap between a perceived threat and an immediate cost helps explain why energy prices carry such political weight in the US. Gasoline is not just another expense. It is a daily, visible one. When prices at the pump rise, the impact is immediate and broad. With a threat that, for many Americans, seems abstract, that is a price not easily accepted.
Even as gas prices rise, markets remain relatively stable
And yet, even as gas prices have risen in recent weeks, another set of numbers has remained relatively contained: the markets.
Oil has climbed, but it has not “gone off the charts.” Stock markets have wobbled but not collapsed. Compared to past crises, the 2008 financial meltdown, the early days of the COVID-19 pandemic, even the initial shock of the Ukraine war, the declines have been modest.
That, too, is telling. And here, Trump’s own rhetorical pattern may be playing a stabilizing role.
His approach has been familiar: issue a sharp threat, escalate the rhetoric, then signal a potential off-ramp, talk of ceasefires and negotiations, before returning again to deadlines and threats.
Only sustained escalation, pressure without pause, would likely push oil prices significantly higher and stock markets significantly lower. But a cycle of threats and pauses, escalation and potential de-escalation, creates a different environment: one of tension, but also of restraint.
In that sense, the roller-coaster nature of Trump’s rhetoric may be contributing to a kind of ceiling. Prices rise on the threat; then fall on the possibility of resolution. The result is volatility, but within a range.
Today’s oil prices are high, but they are not without precedent and should be kept in perspective. The economic damage, while real, is unlikely to be permanent unless the Strait of Hormuz is closed for many months. And the markets, for now, are behaving not as if the worst is inevitable.
That is a more nuanced picture than the headlines often suggest.
Or, to put it differently: this is not uncharted territory. It is a familiar landscape, one the global economy has traversed before, and one it has, time and again, managed to navigate.