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By Alia Shoaib
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A man once tapped by President Donald Trump to lead the Bureau of Labor Statistics (BLS) has warned that the U.S. economy is not strong enough to handle soaring oil prices caused by the ongoing war in Iran.
"The economy is weaker than we thought it was, and inflation is worse than we thought it was," EJ Antoni told the Financial Times on Wednesday, after oil prices soared over $100 a barrel last week.
"I don’t think this is an economy that is going to be able to handle $100 a barrel for oil, it’s just not," he said.
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Newsweek contacted the Federal Reserve via email on Thursday.
Why It Matters
The ongoing conflict between the U.S., Israel, and Iran has sent shock waves through global energy markets.
Iranian strikes on Gulf energy facilities have sent oil and gas prices skyrocketing and tensions in the Strait of Hormuz, a key oil shipping route, have further amplified market fears.
Antoni has warned that rising fuel costs could push up prices across the U.S. economy and exacerbate existing economic vulnerabilities.
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What To Know
Speaking to the FT, Antoni, who is the Heritage Foundation's chief economist, warned of rising consumer prices in the U.S. in response to the Iran war and said higher energy costs will "put upward pressure on prices throughout the economy."
He pointed to sluggish job growth and high inflation, even before the Iran conflict, as signs that the U.S. economy is already weakened.
The economist noted that lower energy prices in 2025 had helped put downward pressure on prices throughout the economy, with the current situation having the opposite effect.
Antoni was tapped to lead the BLS by Trump in 2025, before the president withdrew him from consideration following concerns over his experience for the role.
His warnings about the U.S. economy come as polling shows that rising gas prices are hurting the president.
The Federal Reserve on Wednesday held interest rates steady and projected a rise in inflation in the near term in response to higher energy prices. Its chair, Jerome Powell, cautioned that uncertainty surrounding the future of the conflict made it difficult to predict the impact of the U.S. economy.
What People Are Saying
Jerome Powell, the Federal Reserve chair, said in a press conference on Wednesday: “In the near term, higher energy prices will push up overall inflation, but it is too soon to know the scope and duration of the potential effects on the economy."
EJ Antoni wrote on X on Wednesday: "If war is done in next few days, damage to energy infrastructure is minimal, and Iran lets ships transit strait unmolested, there'll be minimal impact; but drag this on for months and destroy lots of infrastructure, then impact will be big; no one knows the future."
What Happens Next
The impact of the Iran conflict on U.S. inflation and economic growth remains uncertain, and will depend on how long the conflict continues and the extent of damage to energy infrastructure.
Officials have provided few clues about when the conflict might end, leaving an unpredictable situation.
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