It looks like there may be a motive we didn't initially consider with Trump's blockade of Iran. It's going to permanently damage more oil infrastructure. Not just in Iran, but for everyone on the other side of the Strait.

Basically, when oil can't be extracted from an already tapped deep well, the pressure buildup will cause the oil to find new places to flow in the upper crust that the oil is now exposed to. That can be a pressure release, meaning it will never flow with the same pressure again. This is a known problem with conducting what is know in the industry as a "shut in." When there is no place to store oil because the market isn't accepting it, operators will conduct a shut in. But if they do it too long, permenent damage is likely. It is estimated that US allies in the region have already experienced shut in damage.

This would work out for the US in the long run since it is an oil exporter. And it would especially work out for US oil firms, which have established lobbying power and political weight.

The US really is throwing all of its allies under the bus. This conflict hasn't been good for Gulf region allies, even though they were foolish enough to cheer this conflict on in the early days.

It's not good for Asia. It may sour them enough on the US that China now has fewer roadblocks to gain a political presence in Asian pacific countries. Something it already does and now will do more easily.

And this hasn't been good for Europe or the perception of the US in Europe. It really doesn't help the US's contrast with the boogieman that the US defense industry wants Europe to have, Russia. Russia threatened, then invaded a country with proximity to the EU. The US threatened territory belonging to a member of the EU. Russia provides oil. The US shuts down oil. Russia has killed civilians in Ukraine. The US has thrown its allies under the bus to protect the right of Israel to commit genocide without external interference. When it comes to territory threat, economic threat, and value alignment, the US is narrowing the gap to the point that it is equal or worse or near to Russia on everything Europe cares about. Negative impressions tend to linger, so Europe will likely still disfavor Russia more so than the US for some time to come. But the US isn't helping to maintain Europe's perception that it is an actual strategic partner.

Besides the US conflict with Iran there are a few other factors also pushing prices in the same direction. In terms of conflict, we also have Ukraine taking out Russian oil infrastructure. But besides conflict, we also have the demand side. Particularly AI.

As we know, gas prices have shot up everywhere in the world, including the US, despite the fact that it doesn't import oil from the region. That's because oil is a global market. But it's not just oil that is a global market. So is energy in general. The demand for energy has increased as a result of AI. In Utah, a data center is going in that will use as much energy as the entire rest of the state. So Utah's energy consumption just doubled, or is about to. And when current non-oil sources of energy can't immediately cover the increased demand, it's going to mean burning oil.

What I didn't cover here but could have covered with more depth is the fact that water and energy are actually a unified market. It will be interesting trying to grow crops with less fertilizer and less water.

So in short. This war has no signs of ending. One side has an economic interest in continuing it, and maximizing its fallout. Both the short term and long term impact on prices is something the US has no interest in mitigating, and is actively pursing a policy that it knows will permenently damage supply even from its own allies. Energy demand is also sky rocketing. And so there is very little reason to assume that oil prices will return to their pre-conflict levels.