Daijiworld Media Network - Washington
Washington, Apr 16: The United States expects the ongoing tensions involving Iran to ease within a matter of weeks, with officials expressing confidence that the economic fallout—particularly on global oil markets—will remain limited.
Speaking at a policy event hosted by The Wall Street Journal, US Energy Secretary Chris Wright said the situation is unlikely to result in prolonged economic strain, despite a short-term rise in fuel prices.
“I think the conflict will be resolved in the next few weeks,” Wright stated, emphasizing that the US economy entered the crisis on strong footing. He noted that while gasoline prices are slightly above $4 per gallon, they remain below the peaks seen in recent years.
Wright highlighted that robust domestic investment and manufacturing activity would help cushion any external shocks. According to him, much of the country’s economic momentum remains largely unaffected by the geopolitical situation.
To stabilise global markets, the US has coordinated with international partners on a large-scale release of oil reserves, estimated at $400 million. While the rollout of these supplies will take time, Wright suggested the conflict would likely be resolved before the full impact of the release is felt.
He also underscored the strength of US energy production, noting that the country remains the world’s leading producer and exporter of oil and natural gas. This position enables Washington to support allied nations facing supply disruptions.
Wright warned that Iranian oil exports could decline sharply if restrictions in the Gulf persist, potentially forcing Tehran to scale back production due to limited storage capacity.
At the same time, alternative sources are helping balance global demand. He pointed to rising output from Venezuela, which has increased significantly in recent months and is helping offset growing consumption. Venezuelan crude, he noted, is particularly compatible with US refineries.
Beyond the immediate crisis, Wright stressed the growing importance of US liquefied natural gas (LNG) exports to regions such as Europe and Asia, where demand remains strong and prices are significantly higher than in domestic markets.
The developments come as global markets remain sensitive to disruptions in the Gulf region, a vital corridor for energy supplies. Any prolonged instability could affect major importers like India, which relies heavily on crude oil imports.
However, increased US exports and diversified sourcing, including supplies from Latin America, have helped reduce vulnerability to sudden shocks in recent years.