Oil prices are approaching the $100 psychological threshold, leaving Trump in a dilemma over the Iran conflict.

As international oil prices once again approach the key psychological threshold of $100 per barrel, U.S. President Donald Trump’s available policy tools amid escalating tensions with Iran are dwindling, leaving energy markets facing heightened uncertainty. Analysts note that global oil and fuel emergency reserves have dropped significantly, while shipping risks in the Red Sea continue to rise. If the conflict expands further, the U.S. may face two options: scaling up military operations, or accepting Iran’s de facto control over the Strait of Hormuz. Oil prices briefly topped $100 per barrel earlier due to Houthi attacks on Red Sea shipping in Yemen before pulling back. Energy analysts warn that if both the Bab el-Mandeb Strait and the Strait of Hormuz are disrupted, oil prices could rebound to around $124 per barrel in August. Currently, the U.S. has limited policy tools: its Strategic Petroleum Reserve (SPR) has fallen to roughly 311 million barrels, the lowest level since 1983; U.S. shale oil production and refining capacity are already near peak levels; there is limited room for releasing additional strategic reserves; and measures like suspending fuel taxes require congressional approval. Analysts point out that $100 per barrel is not just a price shift, but also carries major market psychological implications, amplifying investors’ concerns about energy crises and inflation risks. Meanwhile, Iran believes it holds negotiating leverage on the Strait of Hormuz issue, demanding greater control. Some analysts argue that Trump’s core choice now is to either continue escalating military operations or seek a solution through negotiations. Market participants say that with U.S. midterm elections approaching, high oil prices could further increase political pressure on the Trump administration, and any final resolution will depend on whether the U.S. and Iran can reach a new agreement.