Gary Cohn, former head of the National Economic Council under President Trump, stated that a potential U.S.-Iran truce would not lead to a rapid decline in prices. Speaking on CBS's Face the Nation with Margaret Brennan, Cohn highlighted the complexities surrounding the Strait of Hormuz as a key factor.
Economic Realities and Geopolitical Risks
Cohn emphasized that any agreement with Iran would need to address the logistical and security challenges of the Strait of Hormuz, a critical chokepoint for global oil supplies. "We're going to have to see exactly what happens with the Strait," he said, noting that the region remains a volatile flashpoint.
Prices are not going to fall like a rock overnight.
Cohn’s comments underscore the limitations of diplomatic deals in immediately reshaping economic realities. The Strait of Hormuz, through which a significant portion of the world's oil transits, has been a hotspot for geopolitical tensions, including naval confrontations and threats to shipping lanes.
Impact on American Workers
While a U.S.-Iran deal could theoretically stabilize global energy markets, Cohn’s remarks suggest that American consumers and workers should temper expectations for immediate relief. Oil prices, a key driver of inflation, will likely remain subject to regional uncertainties and broader market dynamics.
Cohn, now IBM vice chairman, has consistently advocated for policies that prioritize domestic economic stability. His latest comments align with a broader skepticism toward relying on foreign agreements to solve domestic economic challenges.