US Treasury Secretary Scott Bessent expressed confidence on 29 May that global oil prices could drop sharply once shipping disruptions in the Gulf ease, asserting that energy markets are well supplied despite mounting tensions around the Strait of Hormuz. Speaking at a White House briefing, Bessent argued that fears of a prolonged energy shock may be overstated.

What Bessent Said

'There are almost 2,000 ships waiting to come out of the Gulf and I think the oil market is going to be very well supplied on the other side of this, and that we could see prices come down very quickly,' Bessent told reporters. He also noted that oil prices had already softened during the month: 'What we've seen is actually oil prices are down about 10 per cent in May.'

On the outlook for fuel costs at the pump, Bessent added: 'I would expect on the other side of this that gasoline prices will follow.'

The Hormuz Factor

The Strait of Hormuz is one of the world's most critical maritime chokepoints, with a significant share of global oil supplies transiting it daily. Bessent stressed that free navigation through the waterway is a key condition the Trump administration is seeking in its ongoing discussions with Iran. 'The Strait of Hormuz has to have free transit. Navigation of the seas has to be free and open as it was before,' he said.

Asked whether a prolonged closure could create longer-term supply problems, Bessent suggested the disruption may ultimately trigger a surge of shipments once transit resumes. 'As the strait opens up, we're going to see this burst of ships come out,' he said, raising questions about refining and logistics capacity to absorb the volume quickly.

US Energy Dominance Argument

Bessent linked the administration's confidence to America's expanded energy output, describing it as a structural buffer. 'We are more resilient to energy price fluctuations due to President Trump's energy dominance and deregulatory agenda,' he said. 'The United States is now the world's largest energy exporter. The United States has never exported so much energy or produced so much energy.'

The Treasury Secretary also indicated that additional supplies from major energy-producing nations — referenced in recent discussions — could further stabilise markets once normal shipping resumes.

Inflation and Economic Outlook

Bessent connected energy stability to the administration's broader economic narrative, noting that inflationary pressures are expected to moderate if oil markets continue to settle. He argued that economic growth has remained resilient despite concerns about inflation and global uncertainty — a framing that aligns with the Trump administration's pre-election messaging on cost-of-living relief.

Notably, this is not the first time a senior US official has sought to talk down energy prices during a Gulf crisis; similar reassurances were offered during earlier episodes of Hormuz tension, with mixed results depending on how quickly diplomatic channels moved. Markets will be watching whether the diplomatic track with Iran translates into verifiable easing of transit restrictions in the days ahead.