BUSINESS

Oil nears $120 as Hormuz closure hits global economy

Thursday, March 12, 2026 · 9 sources

The Tucker Carlson Show Peter St Onge Podcast TFTC: A Bitcoin Podcast Breaking Points with Krys…Breaking Points with Krys…Breaking Points with Krys…Breaking Points with Krys…Forward Guidance The Jack Mallers Show

The effective closure of the Strait of Hormuz has triggered the largest oil supply shock since the 1970s, with analysts warning prices must surge to $200 a barrel to destroy global demand.
The conflict is being weaponized economically, with China losing its discounted Iranian oil and the U.S. facing a bond market crisis as its traditional wartime safe haven fails.
Market volatility and official panic reflect a dangerous escalatory cycle with no clear off-ramp, threatening widespread energy shortages and systemic financial instability.

Oil markets are reeling from a historic shock. The Strait of Hormuz, a chokepoint for 20% of the world's petroleum, is effectively closed. According to analyst Rory Johnston on Breaking Points, this represents the largest disruption to global energy systems in at least 50 years.

Prices are spiking toward $120 a barrel, but Johnston argues this is just the beginning. To balance the loss of 20 million barrels per day, equivalent to peak pandemic demand destruction, prices must rise high enough to crush global consumption of jet fuel, diesel, and gasoline. He projects U.S. gas prices will head toward $6 a gallon, while poorer nations will face outright shortages and gas lines.

The crisis is already a form of economic warfare. Peter St Onge argues the U.S. strike on Iran was a strategic blow to China, which had been buying 90% of Iran's sanctioned oil at a steep discount. Removing that supply forces Beijing to outbid other nations for expensive Russian crude, exacerbating its economic crisis.

On the financial front, the traditional wartime playbook is breaking down. Jack Mallers notes that U.S. Treasury yields are rising, not falling, signaling a loss of creditor confidence just as the U.S. needs to finance massive deficits. Iran, he argues, is choosing to fight through oil price inflation, betting the fiscally strained U.S. cannot withstand the pressure.

The Trump administration's response has been marked by panic and conflicting signals. On Breaking Points, Krystal Ball highlighted the administration's desperation over oil prices, while Saagar Enjeti detailed how Trump's erratic statements have whipsawed markets. Behind the bravado, advisors are reportedly leaking concerns about political backlash and seeking an exit.

There is no easy off-ramp. Iran shows no sign of backing down after the assassination of its leader, and Trump has refused to rule out deploying ground troops. This escalatory cycle, as described on The Tucker Carlson Show with Colonel Douglas MacGregor, risks systemic collapse, threatening the petrodollar system and triggering a global economic catastrophe.

Rory Johnston, Breaking Points:
- I think the main thing the oil market is attempting to handicap is the duration of this disruption through the Strait of Hormuz and the broader attacks against infrastructure in the region.
- This is the largest scale disruption of energy systems at least since the 1970s, and potentially, if this goes on much longer, potentially the longest in history.

Markets Macro Energy War Trade

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What each podcast actually said

TFTC: A Bitcoin Podcast

Ten31 Timestamp: To Rule the Waves • Mar 11

An escalating Middle East conflict has closed the Strait of Hormuz and struck critical oil and gas infrastructure.
These events are driving energy prices towards historic highs, with Brent and WTI oil nearing $120 a barrel.
John Carvalho noted this situation forcefully reasserts the physical world's economic relevance, challenging assumptions of ever-decreasing production and transport costs.
The market may be underestimating the gravity of the ongoing Middle East conflict.
Some speculate the conflict serves as a strategic economic pressure point against China.
The Strait of Hormuz, now effectively shut down, controls roughly 20% of the world's liquid petroleum products.
The shutdown of the Strait of Hormuz is expected to have severe downstream impacts on every market and drive inflation.
Marty Bent argued the market has not fully digested the gravity of infrastructure hits, especially to refineries, despite actual hits occurring.
Bent compared the current situation to 2022 fears over Russian oil infrastructure, which caused WTI to spike above $130.
Despite actual infrastructure hits occurring, market futures currently imply a short-term reversal in energy prices.
The 10-year Treasury yield, a traditional safe haven, is rising alongside oil prices rather than attracting a bid.
This indicates the market struggles to price in structural inflationary pressure on fixed income and the US's existing debt stack.
Carvalho emphasized that assumptions about production and transport costs for goods always trending to zero are not necessarily valid.
China relies on the Strait of Hormuz for 45% of its oil, making the conflict a significant geopolitical factor.
The thesis of the conflict being a strategic play suggests a sustained economic pressure point with profound implications for global supply chains and geopolitical power dynamics.

Markets Macro Energy

Breaking Points with Krystal and Saagar

3/10/26: Trump Threatens 'Fury' On Iran, Israel Panics, Iran Rejects Ceasefire • Mar 10

Donald Trump sent conflicting public signals about the Iran war to manipulate financial markets, according to Breaking Points.
Trump told a reporter the war was 'very complete' near market close, boosting the S&P 500 and lowering oil prices.
Later, Trump threatened Iran with 'fire and fury' and said it would be hit '20 times harder', causing market volatility.
Trump's aggressive public threats starkly contrasted with his advisors' private desire for an exit strategy, revealing internal panic.
Behind the scenes, Trump advisors reportedly leaked concerns about political backlash and depleting support for a prolonged war.
The advisors encouraged Trump to articulate an exit strategy, highlighting the administration's struggle to control the conflict narrative.
Saagar Enjeti argued that once in an escalatory cycle, it's not easy to simply declare victory and walk away.
The conflict escalated with a strike on an oil refinery in the UAE and multiple other targets across the region.
High oil prices prompted G7 nations to consider releasing strategic petroleum reserves to mitigate economic damage.
Iran rejected calls for a ceasefire, with officials telling Trump to 'be careful not to get eliminated yourself'.
This hostile rhetoric from Iran, following the assassination of a previous leader, suggests the country is far from backing down.
The analysis concludes the US is trapped in a dangerous escalatory cycle with Iran, making a clean off-ramp difficult.

War Markets Diplomacy Trade

3/10/26: US Scrambles On Depleting Munitions, Trump Begs Ships To Cross Strait Of Hormuz, Epstein Prison Guard Cash Deposit • Mar 10

The oil market is experiencing dramatic price swings above and below $100 a barrel.
Krystal Ball stated the administration is panicking over the price of oil.
Trump urged ships to traverse the Strait of Hormuz unapologetically, which is seen as dismissing real risks.
Iranian missile capabilities pose a real risk to ships in the Strait of Hormuz.
The insurance industry is hesitant to cover voyages through the Strait of Hormuz amid rising geopolitical tensions.
U.S. gas prices surged from around $2.92 a month ago to approximately $3.54 today.
The administration's emergency measures to release oil reserves are a temporary solution at best.
Analysts predict the oil price surge could lead to energy shortages and significant demand destruction in many developing nations.
Countries like Bangladesh and Pakistan are already facing power outages as energy supplies dwindle.
Gas constraints in places like Bangalore could prevent hotels like Marriott and Hilton from serving breakfast.
Krystal Ball called it disgusting and preposterous to urge sacrifices for a war that people do not want.
Analysts note that the Iranian regime may not be inclined to allow a U.S. resurgence, opting for long-term economic warfare.
The Iranian state sees economic pressure as a strategic weapon to destabilize American markets.
The interdependence of global economies means a contraction in Gulf states could send ripples through the U.S. market.
If major investors from Gulf regions pull back, the U.S. could face a wave of sector disruptions.
Shaky job numbers in sectors reliant on affordable energy suggest a looming economic crisis.

3/9/26: Oil Apocalypse, New Ayatollah Chosen, Jeff Sachs Dire Warning, Lindsey Graham Coached Bibi On Convincing Trump • Mar 9

Oil analyst Rory Johnston describes scenes from Tehran as apocalyptic, with oil raining from black clouds, acid rain risks, and burning storm drains.
Johnston says the oil market's primary concern is the duration of the disruption through the Strait of Hormuz.
Johnston argues that a leader framing the disruption as a short-term issue suggests they believe the conflict can be managed indefinitely, meaning the Strait of Hormuz closure could persist far longer than anticipated.
The Strait of Hormuz closure represents the largest oil supply shock since the 1970s, dwarfing disruptions from the Ukraine war and COVID pandemic.
The loss of 20 million barrels per day from the Gulf system is roughly the same size of demand destruction seen at the absolute peak of COVID lockdowns in March and April 2020.
To balance the loss of supply, oil prices must rise enough to crush demand across air travel, freight, and consumer consumption globally.
Oil analyst Rory Johnston says $200 per barrel prices are 'brutal physics', not clickbait, needed to force global demand destruction equivalent to peak lockdowns.
The crisis will manifest first as diesel and jet fuel shortages.
Gasoline in the U.S. is already projected to breach $4 per gallon and head toward $6.
The price spike will be asymmetric, with wealthy nations like the U.S. paying much higher prices, while the developing world faces outright shortages and gas lines.
Asia's jet fuel prices have already jumped to levels equivalent to over $200 per barrel.
Refineries in Asia, terrified of losing feedstock, have preemptively slashed operations from 90% to 65%, instantly cutting diesel and jet fuel supplies.
Johnston states this isn't a prediction but a physical constraint, as tankers loaded a week ago are still sailing, so the full crude supply loss won't hit global refining for a month or two.
Johnston says the downstream panic, and the demand destruction it requires, is already here.
Johnston describes this as the largest scale disruption of energy systems at least since the 1970s.
Johnston warns that if the Strait of Hormuz closure goes on much longer, it could potentially be the longest energy disruption in history.

Also discussed (1)

Donald Trump's recent social post, claiming oil prices will drop rapidly when the 'Iran nuclear threat' is over, is described as the worst possible signal to the market, according to Johnston.

Energy Markets Macro

3/9/26: Trump Doesn't Rule Out War Draft, Fox Coverup On Trump Fallen Soldier Disgrace, Desalination Plants Struck • Mar 9

President Trump refused to rule out deploying US ground troops to Iran, stating any deployment would need a very good reason.
Trump said the goal of a deployment would be to decimate Iranian forces to the point where maybe nobody is left to surrender.
Trump suggested the map of Iran would probably not look the same after the conflict.
Breaking Points host Saagar Enjeti argued this imperial framing transforms the war from an attack on a regime into an attack on the Iranian nation-state itself.
Enjeti said this framing gives Iranian propaganda a powerful rallying cry and ensures the population will fight to the death.
Host Krystal Ball noted another American service member was confirmed killed.
Ball stated it is now incontrovertible that a US Tomahawk missile struck a girls' school in a double-tap strike, killing 168 children.
Apocalyptic scenes of burning oil supplies in Tehran are creating a literal movie of a hellscape for civilians, according to Krystal Ball.
Regional actors like the Iraqi Kurds want no part of the conflict, remembering they were abandoned before.
The Iraqi Kurds are now within range of Iranian missiles, making their refusal to join any incursion a practical decision.
Saagar Enjeti summarized Trump's comments as completely all over the map, with the most noteworthy being not ruling out boots on the ground.
Enjeti concluded that at every turn, all Trump does is make the war even more existential for the people of Iran.
The stated US goal appears to be regime collapse and chaos in Iran.
Every escalatory comment and confirmed civilian strike makes regime collapse less likely and a wider, more devastating war more certain.

War Middle East

The Jack Mallers Show

Oil, Bonds, and Bitcoin: The Rules Are That There Are No Rules • Mar 10

Iran is retaliating against US pressure by manipulating oil prices to trigger inflation, according to host Jack Mallers.
Mallers argues Iran believes the fiscally strained US, with its $40 trillion debt, cannot withstand another inflationary spike.
Iran's counterattack is economic, not nuclear, exploiting US debt burden and political intolerance for inflation.
Mallers states Iran is weaponizing energy prices by threatening to disrupt oil flows.
Iran is betting it can outlast the US in a protracted price war because Washington cannot afford it.
The bond market is failing as a traditional wartime safe haven, with yields rising instead of falling during current turmoil.
Mallers notes this yield inversion suggests foreign creditors are losing confidence in US credit.
The system depends on exporting dollars to finance imports, a circular game that cracks when trust evaporates.
Sunday night saw a massive spike in oil futures followed by a complete reversal, which Mallers interprets as evidence of fragility.
The S&P 500's first 5% correction since November adds to the picture of a perfect storm of war and financial stress.
Mallers sees war destabilizing the geopolitical order while financial stress exposes what he calls the monetary ponzi scheme.
Traditional wartime finance is breaking down, leaving the dollar system exposed to a new form of asymmetric warfare.
Host Jack Mallers stated, 'I think that Iran is choosing inflation over nuclear weapons.'
Mallers also said, 'Iran's fight back is through the oil price.'

War Trade Markets

The Tucker Carlson Show

Newest War Developments: AI Bombings, Advice to Trump, and the Nuclear Agenda to Reset the World • Mar 9

Colonel Douglas McGregor states that the information blackout on the Iran-Israel conflict hides not only civilian casualties but also the closure of the Strait of Hormuz.
McGregor argues the closure of the Strait of Hormuz is already impacting global energy markets and supply chains.
Military escalation is being driven by two belief systems McGregor calls 'theological', one apocalyptic and religious and the other secular and technocratic.
McGregor argues this conflict differs from recent U.S. wars because it lacks a principle linking the exercise of power with justice.
McGregor warns the lesson for other states from this conflict is to obtain nuclear weapons or risk regime change, which will accelerate global proliferation.
McGregor notes that a top-down 'demand for targets' can warp military campaigns into strategy-free bombing runs.
McGregor cites the bombing of a girls' school in Iran as an example of a strategy-free bombing run driven by the demand for targets.
McGregor is cautious about confirming the use of autonomous AI weapons but highlights the pressure to use force.
Tucker Carlson and McGregor argue that if initial U.S. diplomacy was a deceptive ruse, it is a grave betrayal that destroys credibility and makes future peace impossible.
Colonel Douglas McGregor states the U.S.-Israel relationship is historically unique, arguing the U.S. has never before ceded such decisive wartime policy influence to an ally.
McGregor warns continued escalation threatens the petrodollar system and could trigger economic catastrophe and domestic instability.
McGregor argues the ultimate risk of continued escalation is a global realignment that permanently weakens American influence.
McGregor concludes that restraint is the only off-ramp from the current path of escalation.

Also discussed (3)

The secular theological belief system envisions a 'great reset' into a new model of technological governance.
Both Carlson and McGregor argue that honor, not deception, is the only viable diplomatic path forward.
McGregor suggests Prime Minister Narendra Modi of India could serve as a potential neutral mediator in the conflict.

War Diplomacy Middle East

Peter St Onge Podcast

Ep 163 Weekly Roundup: Iran, China, and the Petrodollar • Mar 9

The US strike on Iran's leadership was not just about Iran but a targeted economic attack on China, according to Peter St Onge.
Prior to the strike, China was buying 90% of Iran's sanctioned oil exports at a steep discount.
Iran, Venezuela, and Russia together provided 40% of China's oil imports, giving its manufacturing sector a critical cost advantage.
By removing Iran and Venezuela as sources of cheap oil, the US forces China to bid for more expensive Russian supply.
This move could drive up China's energy costs, exacerbating its overcapacity and real estate crises.
Peter St Onge draws a parallel to 1940s Japan, which was pushed toward war when America strangled its oil supply.
A deeper layer involves the 'petrodollar defense' theory, which holds the US punishes regimes that stop pricing oil in dollars.
Protecting the dollar's reserve currency status is seen as enabling the US to carry its $38 trillion in debt.
Knocking out Iran and Venezuela, two major non-dollar oil exporters, fits this petrodollar defense pattern.
The move signals a potential US pivot from wanting a weak dollar for exports to needing a strong dollar to finance deficits.
Peter St Onge notes China had been a big beneficiary of the Ukraine war, buying discounted Russian oil and gas that used to go to Europe.
The geopolitical chess match is now centered on energy and currency, with China losing its discount oil supply.
The US action may trigger a global scramble for oil supply among major economies.

Also discussed (1)

The strategic aim is to force China to outbid other buyers, like India, for Russian oil.

Markets Energy China Trade

Forward Guidance

Is The Iran Energy Shock About To Break Markets? | Weekly Roundup • Mar 6

The Iran-Israel conflict is creating significant volatility in oil markets.
Market reactions reveal a lack of consensus on the severity and duration of the supply disruption.
Oil prices are experiencing acute stress and volatility not seen since the early days of the COVID-19 pandemic.
Extreme volatility is concentrated in front-month oil contracts, where speculation has ramped up.
Despite the headlines, oil is hovering just above $80, a price level lower than some might expect.
Speculative pressures from traders are heavily influencing current market performance.
Speculators are overwhelmingly focused on short-term, front-month contracts due to rapid geopolitical shifts.
Producers are hedging against future price uncertainties, adding complexity to the oil pricing curves.
A significant market divide exists between retail investors and institutional 'smart money'.
Retail investors remain optimistically bullish and are buying the dip even as charts decline.
Institutional money is reevaluating positions, pulling back from high-flying stocks and accepting mounting risks.
The speaker notes that all supply shocks start similarly, and the key question is the duration of the disruption.
According to the speaker, the market has not yet fully accepted how long the Iran-Israel crisis will last.
The core question for energy markets is how long the disruptions will last and what their ultimate shape will be.

Also discussed (1)

This crisis represents a potential climax of decades of geopolitical decisions, according to the analysis.

The Frontier Curator

Oil nears $120 as Hormuz closure hits global economy

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