Predict "When Trump will end the war"? These are five key points

# Xu Chao

Source: Wall Street News

Barclays identifies five key catalysts as the most critical high-frequency tracking metrics for gauging energy market direction: progress toward military objectives, congressional funding battles, U.S. military casualties, retail gasoline prices, and Trump’s personal judgment. When the war ends will directly determine whether crude oil reverts to $85 per barrel or breaks above $110.

The Iran war has become the strongest geopolitical shock to global energy markets since the 1990 Gulf War.

Since the outbreak of the Iran war on February 26, 2026, Brent crude has surged 44% in just 25 days. U.S. wholesale gasoline (RBOB) prices have risen 48%, U.S. diesel prices 51%, and European diesel prices 58%.

In its latest research note, Barclays Capital warns: When the war ends will directly determine whether crude oil prices return to the base-case level of $85 per barrel or break above $110. For investors, five key catalysts—progress toward military objectives, congressional funding battles, U.S. military casualties, retail gasoline prices, and Trump’s personal judgment—are the critical variables currently pricing energy markets.

### Three Critical Price Forks

Barclays forecasts oil prices will diverge at three key timelines:

- If the Strait of Hormuz returns to normal traffic by early April, Barclays maintains its base-case forecast of an average $85 per barrel for Brent crude in 2026.

- If normalization is delayed until the end of April, the average price could reprice to approximately $98 per barrel.

- If disruptions persist through the end of May, the average could reach $111 per barrel.

Each day of delay causes accumulated inventory deficits to propagate in a snowball effect, pushing the price floor higher.

## Five Key Catalysts: Core Variables Determining War’s End

Barclays public policy analyst Michael McLean outlines five catalysts that could end the Iran war:

### 1. Achievement of Military Objectives

The U.S. has explicitly stated three objectives for its campaign against Iran:

- Destroy Iran’s ballistic missile and drone capabilities

- Degrade Iran’s naval forces to secure navigation through the Strait of Hormuz

- Cripple Iran’s military and industrial infrastructure to eliminate its offensive capabilities for years

Notably, regime change or targeting Iran’s nuclear program are not included.

President Trump initially estimated the operation would last “four to five weeks.” The war has now entered its third week, potentially at the midpoint per White House framing.

However, U.S. Central Command has yet to show a clear inflection point of operational contraction, with additional forces still being deployed. While Iran’s missile and drone attacks on the UAE, Kuwait, Saudi Arabia, and Bahrain have fallen sharply, they have not ceased entirely—indicating Iran retains some offensive capacity. Barclays concludes military objectives cannot be deemed achieved until these metrics decline further.

### 2. Congressional Constraints: The War Powers Resolution Creates a Hard May 31 Deadline

The U.S. War Powers Resolution requires the president to obtain congressional authorization (AUMF) within 60 days of deploying armed forces and submitting a report to Congress. The president may extend this period by an additional 30 days, mandating the termination of military operations after 90 days.

President Trump submitted his report on March 2, establishing a hard institutional deadline of May 31 for the war’s end.

Passing an AUMF requires 60 votes in the Senate, where Republicans currently hold only 53 seats. Democrats have already passed two resolutions opposing the war, making AUMF passage highly unlikely. May 31 represents an institutional hard boundary for the conflict.

The war’s economic costs are mounting rapidly:

- First week: ~$110–120 billion

- Current daily operational cost: ~$5 billion

- Total cumulative spending to date: ~$210 billion

For context:

- The Iraq War cost $815 billion in nominal terms over 13 years

- Total U.S. defense discretionary spending for fiscal 2026: $839 billion

- The “One Big Beautiful Bill” has pre-allocated $150 billion to the Department of Defense, providing temporary funding relief

### 3. Rising U.S. Casualties Will Further Erode Public Support

Barclays notes domestic support for the war is fragile and deeply polarized along partisan lines.

As of March 22, RealClearPolitics polling averages show:

- War approval: 41%

- War disapproval: 49%

- President Trump’s overall approval rating: 42% (down slightly from 43%, a record low for his second term; his first-term low was 37% in December 2017)

Thirteen U.S. service members have been killed in the conflict.

Historically, wars typically produce a “rally-around-the-flag” effect, temporarily boosting presidential approval—but Trump has not benefited from this dynamic. The pattern holds: longer wars, higher casualties, and greater public pessimism about victory fuel stronger anti-war sentiment.

### 4. Gasoline Prices Hit a “Political Red Line”: $5 per Gallon Is the Critical Threshold

In July 2022, during the Biden administration, the national average gasoline price peaked at $5.01 per gallon.

For Republicans, not exceeding this “Biden peak” represents a political psychological line in the sand, corresponding to a WTI price of approximately $120 per barrel—more than 20% above current levels.

Republican officials remain optimistic, believing even if prices rise temporarily, there will be sufficient time for them to decline as the war ends before Labor Day (when investors begin focusing on midterm elections). The administration has taken measures to ease price pressure, including releasing strategic petroleum reserves and waiving certain sanctions.

### 5. Trump’s Voluntary “Victory Declaration”

Barclays argues that regardless of battlefield progress, Trump could at any point unilaterally declare victory and end the war. When asked how he would determine the war’s end, Trump’s response was telling: “When I feel it in my bones.”

Barclays emphasizes this catalyst’s timing is virtually unpredictable.

In client discussions, a common analogy draws parallels to Trump’s dramatic policy U-turn after “Liberation Day” (April 2, 2025, tariff announcement), which conditioned investors to believe market sell-offs can trigger policy shifts.

However, Barclays argues current market reactions are not sufficiently “panicked”:

- S&P 500: ~12% decline post-Liberation Day vs. ~5% since war began

- 10-year Treasury yield: +60 bps post-Liberation Day vs. +40 bps since war began

- Investment-grade credit spreads: +26 bps post-Liberation Day vs. peak +9 bps since war began

Most importantly, suspending a tariff executive order is far easier than ending a real war.

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## Significant Upside Price Risk

Barclays’ core assessment: The current oil price rally reflects genuine supply-demand imbalances, not speculative bubbles.

Pre-war, Brent crude was:

- ~19% undervalued relative to its historical fair value implied by OECD inventory levels

- ~15% undervalued relative to replacement cost models

Net speculative long positions in Brent and WTI were at the 2nd percentile of historical levels (since 2014) at the end of 2025.

The dynamic evolution of the five catalysts—progress toward military objectives, congressional funding battles, U.S. military casualties, retail gasoline prices, and Trump’s personal judgment—will be the most critical high-frequency tracking metrics for energy markets. Barclays explicitly states that amid uncertainty, the risk to its 2026 Brent crude forecast of $85 per barrel is skewed to the upside.

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The above content is from追风交易台 (追风Trading Desk).

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