Trump in the Crosshairs as US-Israel War on Iran Brings Armageddon to America

The war involving the United States (US), Israel, and Iran is seen as potentially delivering significant impacts on Washington’s economy. Escalation in the Middle East triggers a global energy price surge that could drive inflation, erode purchasing power, and pose a serious threat to the United States’ economic stability. The US and Israel attack on Iran, which Tehran has retaliated, has rattled global oil markets. The conflict disrupts global energy supplies, including the effective closure of the Strait of Hormuz, a vital route used by around 20% of the world’s oil trade. The impact is directly felt in crude oil prices, with Brent crude briefly rising to its highest level since July 2024. Economists warn that oil price increases will soon translate into higher petrol prices at US petrol stations, a highly sensitive political issue. Oxford Economics’ lead analyst John Canavan said petrol prices are likely to rise within days. ‘Prices at the petrol pumps are likely to rise within a few days,’ he told AFP, quoted Wednesday 4 March 2026. Canavan added that petrol prices in the US have actually been rising since early January. He said retailers usually respond quickly to geopolitically driven developments that could push prices higher. The surge in energy costs is expected to weigh on US households and threaten consumer spending, which accounts for around two-thirds of US GDP. The strain could spill over into other sectors, from transport to logistics. ING economist James Knightley said higher energy prices could result in higher airfares and increased distribution costs. Although the US is relatively self-sufficient in natural gas, he emphasised that domestic prices remain highly influenced by global markets, so any uptick in international prices also risks pushing up electricity costs. ‘There is no doubt this will be a tipping point for the US economy,’ Knightley said. He warned that if households have to spend more on petrol and utility bills, pressure on consumer finances will intensify and could drag on economic growth, especially if the war lasts more than a few weeks. The situation also poses a political threat to US President Donald Trump. His administration is expected to work hard to restrain energy price increases due to their direct impact on public sentiment ahead of the elections. Nationwide’s Chief Economist Kathy Bostjancic said the government is acutely aware that affordability of prices is a major issue for many households. ‘Higher petrol prices will hurt confidence and consumer sentiment. It could show up in the ballot box in November,’ she said. On the other hand, the Iran conflict puts the US Federal Reserve in a tough position. The risk of inflation rising again pushes interest rates to stay high, while economic slowdown and a potential labour market softening could open room for monetary policy easing. New York Federal Reserve President John Williams said the central bank still needs to monitor how long and sustainable the conflict’s impact on prices will be. ‘We have to wait and see,’ he said. Knightley assessed that the short-term inflation risk makes rate cuts hard to implement in the near term, even as pressure on the economy grows. He said the central bank must balance two conflicting objectives, namely keeping inflation low and ensuring maximum employment.