President Trump's recent statement signals that the conflict with Iran will likely last longer than previously expected, shifting the focus from a quick resolution to a sustained military operation.
The White House is now resetting expectations for the conflict. Instead of the “two to three weeks” timeline floated in March and April, the new guidance suggests a slower, more deliberate pace driven by the operational need to reopen the Strait of Hormuz, the world's most critical oil artery. This pivot came after fighting flared up again, with U.S. forces starting to “guide” commercial ships and Iran-linked drone attacks reported in the UAE.
This timeline extension didn't happen in a vacuum, though. First, the immediate trigger was the renewed conflict around the strait, which made a quick, clean resolution impossible. Second, a fragile ceasefire in April failed to secure guaranteed safe passage for ships, leaving military action as the primary option. Third, the administration gained legal flexibility by asserting to Congress on May 1 that hostilities had “terminated,” a move that sidestepped the 60-day limit imposed by the War Powers Act and allowed for prolonged operations without a new congressional vote.
Of course, the financial markets have reacted nervously to this uncertainty. The price of oil has jumped, and stock markets have pulled back from recent highs. This volatility reflects a higher risk premium on energy. For consumers, this has meant gasoline prices hovering above $4 per gallon, a politically sensitive issue. The market's seesawing in April, with the oil ETF 'USO' surging over 17% and then falling 5% as ceasefire hopes came and went, shows just how sensitive investors are to news about the strait.
Ultimately, the conflict's timetable is no longer dictated by political calendars but by the complex and dangerous reality of military operations at sea. The key factor is now the ability of U.S. forces to secure passage through Hormuz, a task that, as the White House now admits, has no simple or swift solution.
- Strait of Hormuz: A narrow waterway linking the Persian Gulf to the open ocean. About a fifth of the world's oil consumption passes through it, making it a critical strategic chokepoint.
- War Powers Act: A U.S. federal law intended to check the president's power to commit the United States to an armed conflict without the consent of the U.S. Congress.
- Risk Premium: The additional return an investor requires to hold a risky asset rather than a risk-free one. In this case, it refers to the extra cost of oil due to the risk of supply disruptions from the conflict.