President Donald Trump expressed surprise at the resilience of the stock market amid the Iran conflict, stating he anticipated a 20% decline in the Dow Jones Industrial Average and S&P 500. In a CNBC interview, Trump said he expected oil prices to surge to $200 per barrel, but they remained around $90. The Dow is near its record high from early February, while U.S. crude oil briefly spiked above $112 per barrel before retreating.
Gas prices fell for the eighth consecutive day, dropping to $4.022 per gallon, according to AAA. Prices have declined nearly 10 cents per gallon from a week ago, though they remain 87 cents higher than a year ago. The decrease follows a surge in fuel costs after the Iran war began in late February, with prices peaking at $4.16 per gallon in early April. Energy Secretary Chris Wright warned that prices may stay elevated for some time.
Market Rebound and Economic Impact
The stock market initially plunged after the conflict began but recovered as fighting subsided. The S&P 500 returned to pre-conflict levels, surprising Trump, who expected a sharper decline. Oil prices also stabilized as ships diverted to alternative sources, including Texas, Louisiana, and Alaska.
Gas Price Trends and Policy Implications
Gas prices had been rising due to refinery disruptions from winter storms before the conflict exacerbated the trend. The recent decline marks the first weekly drop since January. However, prices remain higher than a month ago, with the gap narrowing. Energy Secretary Wright cautioned that a return to $3 per gallon may take time.
Diverging Perspectives on Economic Resilience
Trump’s remarks highlighted his initial expectations of a severe market downturn, contrasting with the actual recovery. Meanwhile, energy officials emphasized the long-term volatility in fuel prices. Analysts noted that market resilience may reflect investor confidence in economic fundamentals despite geopolitical risks.