Kevin Hassett noted on Face the Nation yesterday:
HASSETT: …look at [oil] futures markets, which are interesting because you’ve cited over and over the spot price of gasoline, which, of course, is affected right now by the disruption of the strait, but if you look at the futures prices, they are expecting a rapid, rapid end to the situation and much, much lower prices. In fact, I don’t think I’ve seen a sort of future price path with such a steep decline in all my years watching futures.
It’s true that the futures are about as good as one gets in terms of predicting future oil prices; see Chinn and Coibion (2014), discussion in this post. I recall while serving in the government, futures were used as a quick and dirty guide to expectations regarding oil and other commodity prices.
And Hassett is correct that futures indicate a decline (rapid? That’s a matter of judgement).
I’ll note that the forward curve does not return to the prewar price of $73 until sometime in 2027…
While futures incorporate market expectations, they are essentially of little predictive power during wartime (Gulf War I, Gulf War II thru capture of Saddam Hussein).
Figure 1: Front month oil futures to 3 month futures lagged 3 months, log ratio (blue). War periods shaded light green. Source: NYMEX via Chinn and Coibion (2014).
A regression of price on 3 month lagged futures during has an adjusted R2 of 0.94 during non-war periods, and 0.12 during war periods. While not surprising, it’s useful to remember that futures in this context need not be very predictive.
Real gross domestic product (GDP) in the United States increased at an annual rate of 0.7% in the fourth quarter of 2025, according to the second estimate released by the U.S. Bureau of Economic Analysis (BEA). This was a downward revision from an initial 1.4% estimate. The personal consumption expenditures (PCE) price index increased 2.9% in the quarter. The U.S. economy is slowing and inflation is increasing before Trump’s war.
Did Kevin Hassett have anything to say about that?
This might turn out to be inflationary:
https://www.unionleader.com/news/business/transportation/trump-s-cancellation-of-licenses-for-immigrant-truckers-takes-effect/article_7c21a50c-c907-48ec-b096-bf3e57f6c0ac.html
The felon-in-chief decided to keep legal immigrants from driving commercial trucks. Starting yesterday, their licenses won’t be renewed. That means roughly 200,000 of 3.5 million commercial drivers, about 6%, will eventually lose their licenses and their jobs.
Not long ago, some states were lowering the requirements for commercial drivers, notably age requirements, to overcome driver shortages.
But immigrants, you know? Can’t have ’em close to our precious trucks, ’cause they make Stephen Miller feel icky.
Nah, that means nothing. They are already illegal. This is just virtue signaling. If nobody cares or enforces, even that will be difficult…..well??? Note, during the financial crisis truck drivers with no work visa’s plunged to nothing.
No enforcement? Are you nuts? No license means no insurance. Nobody puts commercial trucks in the road with no insurance.
Not sure what “financial crisis” you mean, but what does that have to do with now?
Each time you comment here, you say something completely unhinged from reality.
Pile a shortage of drivers in top of rising diesel prices and what do you get? Along with a higher cost of transportation, you get small trucking firms going out of business:
“There will certainly be a lot of small trucking companies that aren’t going to be able to survive this surge in diesel prices,” said Avery Vise of FTR Transportation Intelligence.”
https://www.marketplace.org/story/2026/03/17/trucking-industry-hit-by-high-diesel-costs-immigration-restrictions