Scott Bessent predicts oil prices could drop by $40–$50 a barrel after Iran conflict ends

If you’ve been watching oil prices swing between $97 and triple digits this year, Scott Bessent has a message: enjoy the volatility while it lasts, because the other side of this conflict looks very different. The US Treasury Secretary predicted on September 4 that oil prices could fall by $40 to $50 per barrel once the US-Iran conflict reaches a resolution. That math, applied to current Brent crude levels near $97, would put a barrel of oil somewhere in the $47 to $57 range. In other words, roughly half what markets have been pricing during the worst of the tensions. Why Bessent sees a surplus coming New oil production has been coming online globally, and the primary thing keeping prices elevated is the disruption around the Strait of Hormuz, the narrow chokepoint through which a significant share of the world’s seaborne oil passes. Once that disruption lifts, Bessent’s argument goes, supply that has been bottled up floods back into the market simultaneously with the new production that has been building during the conflict. The Treasury has already been threading the needle on supply management during the conflict. It issued temporary authorizations to release Iranian oil held in...