The U.S. Is Insulated, But Not Immune To The Middle East Conflict

2026-03-06 00:30:00 ET

By James Knightley , Chief International Economist, US

Higher energy costs compound tariff concerns

The US has been a net energy exporter since 2019, and while that should insulate the economy from oil and gas flow disruption in the Middle East, it doesn’t mitigate all the risks. The US refinery make-up still requires the need for some heavier, foreign-sourced crude – around 3.5% of the oil consumed in the US comes from Saudi Arabia and the Persian Gulf. Moreover, US oil prices take their cue from global markets. A sustained move in WTI crude above $75/barrel would mean we are on course for US gasoline to breach $3.75/gallon versus $3 currently. Higher airline fares and transport and distribution costs would follow....

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