President Donald Trump’s new war hit the markets Monday morning, with the economic fallout set to hammer the same Americans he needs to save him at the midterms.
Oil and gas prices rocketed as trading opened for the first time since Trump launched his assault on Iran on Saturday. Crude prices were up 13 percent in early trading.
All three major U.S. stock indexes, meanwhile, dropped 1.5 percent as investors scrambled to insulate themselves from an anticipated global economic downturn amid disruptions to energy supplies.
“We were all set to rise to $3.10-$3.25 a gallon with a peaceful Persian Gulf,” Tom Kloza, a senior adviser at Gulf, told Reuters. “We’ll now get there very quickly and the action of the last 48 hours puts higher numbers in play.”
In retaliation against U.S. and Israeli strikes, which began Saturday and are now confirmed to have killed Iran’s supreme leader Ayatollah Ali Khamenei, the Associated Press reports regime and regime-aligned forces have begun targeting oil infrastructure in U.S.-allied countries, including Saudi Arabia, the United Arab Emirates, and Iraq.
The Strait of Hormuz, through which around 20 percent of the world’s oil supply is transported, has been mostly closed to traffic since at least three vessels were attacked on Sunday, per The Washington Post.
Across the U.S., voters have repeatedly balked at Trump’s claims of ushering in “the greatest economy in history,” as he told The Wall Street Journal in December.
At 2.4 percent, inflation remains persistently high, with increased costs of basics such as energy, groceries, and utilities reportedly hitting lower- and middle-income families the hardest. The president continues to rail against “affordability” as little more than a Democratic Party “hoax.”
Republicans already face a bruising battle for control of the House and Senate at midterm elections scheduled for later in November, given Trump’s approval ratings have hovered at a miserable 39 percent for the past several months.
Last Monday, an Ipsos poll found 68 percent of respondents disagree with the president’s rosy assessment of the economy, including 43 percent of Republicans. Reuters reports that just one in four now approve of his ongoing strikes against Iran.
Trump’s new war represents the most seismic development in the country since the Iranian Revolution of 1979, which prompted the total collapse of oil production in what was then one of the largest exporters on the planet.
The ensuing “oil shock,” which resulted in long gas lines across the U.S. and even rationing in some states, contributed to President Jimmy Carter’s thumping loss to Ronald Reagan at elections the following year.
Social media users are already panicking as the markets continue to reel amid Trump’s onslaught. “Go get gas. I just did. Should have got a few cans too but whatever,” one person wrote, attaching a screenshot of stock market indexes and oil prices from CNN.
“Looks like Trump is about to have his first gas price surge as president. How much further can his approval tumble,” another said. “So much winning,” a third added.
The Daily Beast has contacted the White House for comment on this story.
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