If the U.S. joins in it will only escalate the situation. Iran has repeatedly threatened to shut down the Strait of Hormuz, through which ~20% of the world’s oil transits, but has not taken any such action so far. However, the more desperate it is, the more likely that will occur. While oil prices have jumped a bit since the start of the war, currently ~$72 a barrel, if Iran blockades the strait (and presumably mines it), we’re looking at oil jumping to ~$130 per barrel. While the U.S. is currently teetering on the edge of a recession due to the tariffs, such an oil shock would almost certainly bring on a significant recession. Even more concerning is the potential for more escalation, and Trump has repeatedly shown interest in using nuclear weapons. I can easily envision a scenario where Trump thinks it’s a good idea to nuke Tehran to serve as a lesson for the world that he’s a big tough guy.
If the U.S. joins in it will only escalate the situation. Iran has repeatedly threatened to shut down the Strait of Hormuz, through which ~20% of the world’s oil transits, but has not taken any such action so far. However, the more desperate it is, the more likely that will occur. While oil prices have jumped a bit since the start of the war, currently ~$72 a barrel, if Iran blockades the strait (and presumably mines it), we’re looking at oil jumping to ~$130 per barrel. While the U.S. is currently teetering on the edge of a recession due to the tariffs, such an oil shock would almost certainly bring on a significant recession. Even more concerning is the potential for more escalation, and Trump has repeatedly shown interest in using nuclear weapons. I can easily envision a scenario where Trump thinks it’s a good idea to nuke Tehran to serve as a lesson for the world that he’s a big tough guy.