Trump Said Gas Prices Would Fall After The War, Defying The Experts. So Far, He’s Right.

Gasoline prices have fallen precipitously since the U.S. and Iran began their fragile truce, defying expert predictions of a long summer slog with sky-high prices.

Instead of spiraling upward, the average price at the pump has plummeted 70 cents per gallon in a month from a peak of $4.56. A little over a week since the memorandum of understanding was signed between the countries, a barrel of oil costs just a little more than it did before the U.S. and Israel bombed Iran in late February.

It wasn’t supposed to work this way, according to energy experts whose predictions of $150 barrel of oil, $5 gasoline and summer recessions were widely quoted in the media, including POLITICO.

For now, they’ve been proven wrong for a litany of reasons, including a surprisingly weak Chinese economy and a failure to imagine how handily the president could bully the markets into submission.

“There's one thing that being an oil market analyst, much less a price forecaster, will teach you and that is humility,” said Bob McNally, a former energy adviser to the George W. Bush administration, now head of energy consulting firm Rapidan Energy. He predicted that price spikes could still happen in the weeks ahead as the ceasefire remains fragile.

The falling prices are a huge win for the president and his party, helping to blunt an easy Democratic attack line ahead of the upcoming midterms in which voters say they are hyperfocused on the cost-of-living. While voters may never forgive the spike, many political prognosticators thought it was going to be much worse.

If the current prices hold, the midterms may not be quite as catastrophic for Trump and Republicans in November, said Frank Luntz, the veteran Republican pollster. But he said the deadline for easing voter anxiety over affordability is essentially now. That’s because voter attitudes are locked in by August, which means that further price drops in September and October are likely less meaningful.

“Half of Americans live paycheck to paycheck so a momentary drop in prices will not have a major impact on the electorate, it has to be something sustainable,” he said.

Trump, meanwhile, is taking a victory lap.

“GAS PRICES COMING DOWN FAST!!” he wrote on Truth Social Monday.

“[West Texas Intermediate] CRUDE - $69, and heading down,” he wrote in a separate post. “This is less than it was prior to the start of the Denuclearization of Iran!”

WTI crude was actually $67 on February 27, the day before the U.S. and Israel bombed Iran.

“Trust in Trump, not the so-called ‘experts’ and the legacy media," White House spokesperson Taylor Rogers said in a statement. "Oil and gas prices are plummeting, lowering costs for American families.”

Prices are lower than predicted in part because China cut its oil imports, ships snuck through the Strait of Hormuz despite the blockade and oil futures never fully priced in the level of risk, which most energy experts did not expect.

China slashed oil imports by at least 3 million barrels per day, according to Kpler, a commodities research firm. While it isn’t clear exactly why, some suspect it is a combination of a weaker economy and an increase in electric vehicles hitting at the same time as the war.

In addition to reduced Chinese demand, the energy futures market and the cost of actual real-world barrels of oil wildly diverged for much of the war, keeping prices at the pump lower than most thought possible. The market continued to focus on Trump’s claims of a quick resolution to the war and his pledge to quickly drop prices while the price of crude oil in some regions spiked upward as the actual barrels available for sale became scarce.

Trump also used Truth Social to successfully jawbone the markets, repeatedly promising victory and ceasefire, which appears to have helped calm markets and keep oil prices from rising much past $110 per barrel.

It all left energy experts, many with decades of experience, shocked at the resilience of a market seemingly impervious to the worst energy shock in modern memory, during which more than a billion barrels were taken out of the global inventories.

“It's the weirdest thing,” said Rory Johnston, an oil analyst who writes the newsletter Commodity Context. “I've never seen a market like this.”

Even before the ceasefire deal was announced, oil prices were dropping as countries tapped their strategic petroleum reserves and a flow of tankers escaped the strait. Dozens of additional tankers have left in the last two weeks, providing further relief to global oil markets. And with some sanctions lifted, Iran has exported more than 40 million barrels of oil to international markets.

Still, great uncertainty remains. Or as Johnston put it, the price drop is a “temporary sugar high” until empty ships return through the strait to load up more crude oil.

That means oil prices are still at risk of a quick spike. The ceasefire also remains incredibly fragile. Iran attacked at least two ships in recent days and the U.S. launched counterstrikes. The latest round of tit-for-tat strikes reduced the number of ships leaving the strait from 57 on June 24 to 12 on June 28, according to Kpler.

China could also ramp up oil imports, Johnston said. And the buffer of oil storage inventories in multiple countries that kept price artificially low in the last few months is virtually gone, as some facilities hit tank bottom, making the market far more vulnerable to future disruptions.

Greg Priddy, an expert on energy market disruption who worked at the U.S. Energy Information Administration in the George W. Bush administration, said many things could still cause oil to spike and few are in Trump’s direct control.

The war’s effect on global energy prices “was less than a lot of us thought, but it's still a ticking time bomb,” he said.