While media reports suggest that a prolonged war with Iran could hurt the US economy, the data points to a more complicated picture. A closer look suggests that prolonged supply disruptions could benefit the US energy sector and strengthen its position in global energy markets.

Global crude oil production was about 84.5 million barrels per day in 2025, with the US the world's largest producer. The shale revolution and advances in drilling technology have transformed the US into a major energy exporter, with crude exports of around 4 million barrels per day.

Data as of 2025

Supply Shock
The West Asian bloc comprising Saudi Arabia, Iraq, Iran, the UAE and Kuwait produces about 24.5 million barrels per day, or around 29% of global output. Adding Russian production takes the total to about 34.35 million barrels per day, accounting for nearly 40% of world production.

The closure of the Strait of Hormuz, coupled with the Russia-Ukraine war that has continued since 2022, has disrupted export markets and created supply concerns for East and South Asian economies, which are major buyers of crude from West Asia and Russia. Major economies are heavily dependent on imported crude: Japan imports around 95% of its requirements, India 80%, South Korea 70% and Taiwan 60%.

As the war continues, countries are being forced to look for alternative sources of supply. China, which imports about 12 million barrels per day, has stayed away from the import market since the start of the war and previously imported around 4 million barrels per day of West Asian crude. India has also been hit, having sourced around 40% of its crude from the West Asian bloc and another 40% from Russia. With the US threatening 100% tariffs on India over trade with Russia, India has been forced to look for alternative sources.

The LNG market tells a similar story. The US, Qatar and Australia were the world's largest LNG exporters in 2025, accounting for 63% of total exports. With disruptions in the West Asia following the closure of the Strait of Hormuz, around 20% of LNG supply has been cut off, mostly from Qatar. This has forced Asian buyers such as Japan and South Korea, which import about 80% of their LNG from Qatar, to look for alternative suppliers.

Diesel has also been in short supply and is critical to the logistics and transport sectors that keep economies moving.

Of the world's top five diesel exporters, India and South Korea are dependent on imported crude. Higher crude prices and continuing supply-chain disruptions are therefore also affecting the diesel market. Russia has also imposed a ban on diesel exports as its refineries have been hit by Ukrainian attacks. With winter approaching, demand for diesel is expected to rise in Europe, potentially widening the supply-demand gap.

The recent decision by several countries to tap their strategic reserves appears to acknowledge that the market could remain tight. As prices rise, the US president has also discussed restricting diesel exports, and this may serve as a negotiating strategy to put pressure on importers and increase US market share.

US Advantage
The US is the only major economy that is largely self-sufficient in energy. As the data above shows, it is a net exporter of crude and refined products. That makes the US one of the potential beneficiaries of global supply disruptions as Asian buyers search for alternative suppliers.

According to the EIA, US LNG exports averaged 17.4 billion cubic feet per day (BCF/d) in the first six months of 2026, which is 23% higher than in the same period in 2025. Estimates suggest US LNG exports will average 17.3 BCF/d in the second half of 2026 before rising to 18.7 BCF/d in the first half of 2027.

If the war is prolonged, continued supply disruptions could redirect more energy demand towards the US. This could benefit the US in two ways.

First, it could allow the US to gain market share in global energy markets and strengthen its influence over energy pricing. Second, it could increase the use of the US dollar in global energy trade at a time when several countries have been seeking to diversify away from dollar-based transactions.

A prolonged war would therefore not necessarily be an unambiguous negative for the US economy. For the US energy sector, in particular, sustained disruption elsewhere could create an opportunity to expand exports, capture new markets and reinforce America's position not only in the global energy system, but also keep the Dollar stronger.