A generation ago, an American airstrike on Iranian soil would have sent oil markets into turmoil. Prices would have spiked, supply chains would have scrambled, and consumer anxiety would have followed. But this time, following the United States’ targeted strike on Iran’s nuclear weapons infrastructure over the weekend, markets are not panicking. Oil prices may tick upward when trading resumes, but the long-term trajectory appears more stable than dramatic.
This calm comes despite real geopolitical risk. Iran borders the Strait of Hormuz, the narrow waterway through which about 20 percent of global oil passes. Any attempt to close or disrupt this route would have global implications. Yet there have been no credible signs that traffic through the strait is being hindered. No tankers have been delayed, and no critical infrastructure has been visibly damaged.
What has changed is the structure of the global oil economy. The United States has significantly reduced its dependence on Middle Eastern oil. In 2023, it exported more crude than it imported, according to the U.S. Energy Information Administration. Fracking and shale production transformed the American energy position, making domestic supply less vulnerable to overseas shocks. Today, less than 3 percent of U.S. oil imports come from the Persian Gulf.
Meanwhile, China has become the largest buyer of Iranian oil, reportedly importing up to 1.3 million barrels per day. Many of these shipments are sold at steep discounts, reflecting Iran’s limited access to broader markets due to sanctions. Experts suggest that any escalation that disrupts Iranian exports would primarily damage China’s energy security—not America’s.
This dynamic has introduced a strange asymmetry. Iran may rattle sabers, but it risks hurting its few remaining buyers. And without broader regional escalation—such as disruptions in Saudi Arabia or the UAE—global prices may remain relatively insulated.
Moreover, Iran’s total export volume remains restricted. Sanctions from the United States and Europe have already removed much of its oil from global circulation. The International Monetary Fund estimates tens of billions in lost revenue since 2018. As a result, markets are less sensitive to threats that do not alter actual supply.
Prices have risen about 10 percent since Israel’s initial strike on June 13, but they dipped again on Friday after former President Trump delayed a decision on further American involvement. The market is not ignoring the risks—but it is no longer overreacting to every flashpoint in the region. Unless barrels are removed from the market, traders are not inclined to move.