President Donald Trump has intensified his rhetoric following U.S. military strikes on Iranian nuclear facilities over the weekend, demanding that oil prices remain low despite the geopolitical tensions that threaten global energy stability.
His stance has placed the oil market and energy producers under sharp scrutiny as investors brace for potential retaliation from Tehran.
The strikes, which targeted three key Iranian sites, have heightened the risk of Iran disrupting global oil flows, particularly through the Strait of Hormuz—a critical chokepoint for nearly a fifth of the world’s oil shipments. Despite these risks, oil prices dipped slightly on Monday after an initial spike, reflecting a cautious response from markets. However, the potential for prolonged volatility remains high.
Taking to Truth Social on Monday, Trump issued a stark warning to energy producers and market participants: "EVERYONE, KEEP OIL PRICES DOWN. I'M WATCHING!" He emphasized that any significant rise in oil prices would “play into the hands of the enemy.”
The former president reiterated his long-standing support for expanding U.S. domestic energy production, a policy cornerstone of his administration. "DRILL, BABY, DRILL!" Trump declared, reviving his campaign trail slogan. His calls aim to bolster American energy independence and counteract any adverse economic fallout from the conflict.
A White House spokesperson, Harrison Fields, affirmed Trump’s position, stating, “President Trump has always prioritized domestic energy production as a pillar of economic security. He continues to urge producers to act responsibly and ensure prices remain stable to protect American families and businesses.”
Meanwhile, a senior administration official assured investors that the U.S. is prepared to safeguard oil supply chains. "We are closely monitoring the situation and maintaining open lines of communication with key oil-producing partners. Our goal is to repair and restore the U.S. strategic petroleum reserve to provide a buffer against potential disruptions."
Despite the administration's push for increased production, the oil and gas industry has expressed skepticism about the feasibility of significantly lowering prices. According to the Federal Reserve Bank of Dallas’s March 2025 industry survey, many executives remain wary of oversupply scenarios that could erode profitability. One respondent remarked, “At $50-per-barrel oil, U.S. production will decline immediately and significantly. The economics simply don’t support it.”
Market analysts echo these concerns. Higher crude prices pose a significant risk to markets, particularly as the Israel-Iran conflict unfolds. JPMorgan analysts estimate a 20% chance that oil prices could surge by as much as 75%, underscoring the precarious balance between supply stability and geopolitical shocks. Goldman Sachs analysts also pointed to the conflict as a key factor in maintaining their elevated recession probabilities for the U.S. economy.
The energy sector is now navigating a complex landscape, balancing the demands of policymakers against operational and market constraints. While Trump’s call for domestic production resonates with his base, industry leaders warn that market fundamentals cannot be ignored.
For wealth advisors and RIAs, the current scenario underscores the need for proactive risk management in energy-focused portfolios. Advisors should consider diversifying exposure to mitigate the impact of oil price fluctuations and geopolitical risks. Moreover, the unfolding crisis highlights the importance of integrating geopolitical analysis into investment strategies, particularly in sectors susceptible to rapid policy and market shifts.
Trump’s directive to “keep prices down” may resonate politically, but the path forward for energy producers and investors alike remains fraught with challenges. As the U.S. deepens its involvement in the Middle East conflict, the interplay between policy, market forces, and global stability will be pivotal in shaping outcomes for the energy sector and broader markets.
