As gasoline prices in the U.S. hit a historic high ahead of Labor Day, Trump made a high-profile statement to reassure public opinion: post-war oil prices will crash below $2.

As the U.S.-Iran war continues for nearly seven months and gasoline prices in the U.S. just hit a historic record for Labor Day, President Trump dropped a political and economic "bombshell." Trump stated on Truth Social that once the U.S. wins the war with Iran, global oil prices and U.S. retail gasoline prices will see a "cliff-like drop," eventually falling below $2 per gallon. Trump wrote: "When we win the war with Iran, oil prices will plummet, just as everything else is dropping (but even more!). Oil prices will first drop to $3 per gallon and eventually below $2. This will all happen quickly, and Iran will never have nuclear weapons." $4.15 Labor Day "historic high": The reality confronting Trump On the same day as Trump's remarks, American drivers were experiencing the most expensive Labor Day holiday fueling experience in history. According to the American Automobile Association (AAA), the average price of regular unleaded gasoline across the U.S. reached $4.15 per gallon on September 7, setting a historic high for Labor Day and being the first time it surpassed the $4 markpreviously set at $3.82 in 2012. Compared to $3.20 during the same period last year, the current price is about 30% higher. Diesel prices are even more severe, reported at $5.90 per gallon during Labor Day, up from $3.71 a year ago. AAA spokesperson Brittany Moye stated: "Gasoline demand typically declines after the summer driving season, which often pushes prices down. However, this year, higher crude oil costs have offset this seasonal trend." Oil prices approaching $100: The market does not believe in "post-war $2" Despite Trump's painted picture of a post-war collapse in energy prices, the crude oil market's immediate response was the exact opposite. On September 8, WTI crude oil futures rose approximately 2% during the day, reaching $94 per barrel; Brent crude surpassed $98 per barrel. This sharply contrasts with the WTI price of around $67 per barrel and Brent's price of about $72 per barrel prior to the outbreak of war on February 28. The traffic through the Strait of Hormuz has plummeted to a fraction of pre-war levels. According to the U.S. Energy Information Administration (EIA), only about 4.9 million barrels of crude oil and energy products passed through the Strait of Hormuz daily in the second quarter of this year, compared to an average of 21.6 million barrels daily in the fourth quarter of 2025 (pre-war). OPEC+ maintained its production policy for October during Sundays meeting, further reinforcing supply-side tension expectations. Iran's "no-sail zone" upgrade: The end of the conflict is nowhere in sight The day before Trump's comments, the Secretary of Iran's Supreme National Security Council, Rezaei, announced that Iran would establish a new no-sail zone outside the Strait of Hormuz, with vessels entering this area subject to sanctions. Rezaei stated that this no-sail zone "covers from the U.S. Navy's blockade line to loading ports," and any vessels entering without coordination will be added to Iran's sanctions list. Meanwhile, traffic through the Strait of Hormuz has reached its lowest level since May. In the past 10 days, an average of only 10 commercial ships passed through the strait daily, with just 5 ships on September 6 and only 2 ships on September 5. This conflict is evolving from a short-term military operation into a long-term strategic drain. Market: Oil prices may surge to $115 by the end of the year; wartime oil prices have become the new normal There is a significant gap between Trump's optimistic predictions and Wall Street's risk assessments. Brett Erickson, managing director of Obsidian Risk Advisors, clearly pointed out that with the war ongoing and peace agreements nowhere in sight, oil prices could soar to $115 per barrel by the end of the year. Erickson wrote on X platform: The core issue with global oil prices (around $97.50) is that no one on Earth believes that a deal is imminent. At best, this war will last at least until December, and likely even longer. He even warned that surrounding the midterm elections, Iran will inevitably escalate its confrontations significantly before the elections, at which point oil prices could easily hit $115 again. Goldman Sachs previously warned that if shipping attacks in the Middle East escalate further, international oil prices could climb to $120 per barrel. The bank also advised investors to capture related gains by going long on natural gas and diesel. U.S. Treasury Secretary Yellen previously predicted that post-war oil prices could fall to between $40 and $50 per barrel, but veteran investor Peter Schiff scoffed at this: Dont believe anything this guy says. I dont think he even believes his own rhetoric.