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Conventional wisdom holds that the US is pretty immune to the energy market fallout from its war on Iran. After all, most of the Gulf’s hydrocarbons go to Asia and parts of Europe. Moreover, the US is a huge energy exporter, and thus its own energy companies are making bank.
As a result, while the IMF has slashed its forecasts and now expects growth to slow in large parts of Asia, Europe, the Middle East, Africa and Latin America, the US expansion will actually speed up — from 2.1 per cent last year to 2.3 per cent in 2026.
The US being immune from and potentially actually benefiting from the Middle East mess is something that Donald Trump has naturally talked up repeatedly.
However, here are some interesting charts from JPMorgan that show the increase in the retail prices of gasoline, diesel, jet fuel and naphtha between February 27 and April 27.
There are a lot of interesting things here, such as the lack of impact on India (which seems to be mostly due to massive state subsidies, tax adjustments and de facto price controls, which must be costing the government and its energy marketing companies a TON of money).
But the main thing that jumped out to Alphaville was how the US is definitely feeling the pain too — and indeed more pain than other regions.
On one hand this is understandable. Energy is a global, interconnected market, and the US would never be entirely immune from price increases just because it doesn’t import Kuwaiti oil or Qatari LNG. The US energy market is fully deregulated, so global developments hit swiftly. At least the US won’t face shortages, as large parts of Asia are about to unless the Strait of Hormuz reopens soon.
Moreover, these charts just shows relative price increases over the course of the conflict, not absolute price levels. A litre of Octane-95 petrol now costs $1.17 in the US, according to globalpetrolprices.com — about half the price that European motorists have to pay.
Still, as JPMorgan’s analysts note, it is “somewhat counterintuitive” that the US is now experiencing some of the largest price increases globally, and might indicate that it will not prove quite as resilient as many assume. American farmers certainly don’t feel immune.
