Jason Bordoff

One is a general market perception that this was going to result in Trump pulling back, declaring mission accomplished, as we saw with Greenland or with Liberation Day tariffs.

We did not have the staying power, so we'd figure out how to get out of this pretty soon.

I think if this goes on, we haven't seen anything yet in terms of how high energy prices are going to go.

Right now the price of oil that you're reading about in the newspaper is sort of one that's set by traders every day based on market expectations.

At a certain point, physical reality has to catch up.

And prices need to rise high enough to destroy 10 million barrels a day of global demand.

We don't know exactly what that price is, but it's really high, a lot higher than the price is today.

And you're starting to see little signs of that where the price of jet fuel, the price of heating oil are much higher than would be suggested by, you know, a benchmark price of $100 a barrel.

It's true and it's not.

I mean, it is the case that the U.S.

is the largest oil producer in the world.

And it is noticeable that when oil prices spike, Putin celebrates.

But the United States does not, even though we produce more oil than Russia does.

And the reason, of course, is because we're a super large consumer as well.

So I've often heard the Secretary of Energy say high oil prices might be good for oil producers, but they're not good for consumers.

And this administration cares about the 99 percent who consume oil and gas, not the 1 percent who produce it.

An oil price spike of this magnitude means a lot more money for producers, but, you know, consumers pay more at the pump.

And what's different about the impact on the U.S.

today is that an oil price shock is more of a distributional issue, meaning it's affecting people who consume.

It probably has a smaller impact on the macroeconomy, on GDP, than it did before.