Months before the United States entered into a war with Iran that would disrupt global energy markets and drive up fuel costs, the Trump administration eliminated much of the State Department’s internal oil and gas expertise, including analysts responsible for modeling supply shocks and maintaining relationships with key energy partners in the Middle East.
According to reporting from NOTUS, the layoffs occurred last summer as part of a broader push by the Elon Musk-led Department of Government Efficiency, an initiative that cut roughly 1,300 positions at the State Department. Among those dismissed were staff within the Bureau of Energy Resources who specialized in oil and gas markets, including individuals tasked with analyzing scenarios such as a disruption or closure of the Strait of Hormuz, one of the most critical chokepoints in global energy supply.
By the time the layoffs were completed, the bureau had been reduced to personnel focused primarily on critical minerals and clean energy, according to a notification provided to Congress at the time. The cuts also removed officials with established professional and diplomatic ties to oil and gas companies across the Middle East, as well as the individual “primarily tasked with liaising with the International Energy Agency,” the global body that helps coordinate emergency energy responses among nations.
The consequences of those decisions have become more visible in the weeks following the start of the U.S.-Israeli war on Iran on February 28. Since the conflict began, crude oil prices have risen more than 40 percent, with prices surpassing $100 per barrel multiple times. Gasoline prices have also surged, rising by nearly a dollar per gallon, with the national average reaching $3.79 on Tuesday, up from $2.91 the previous month, according to AAA. Data from the Energy Information Administration shows a 27 percent increase in gas prices between mid-February and mid-March.
The war has triggered widespread disruption across the region’s energy infrastructure. Iran has launched strikes on oil and gas facilities throughout the Gulf and targeted shipping lanes, while repeated attacks on tankers in the Strait of Hormuz have caused traffic through the waterway to drop significantly. Countries including Qatar and Kuwait have scaled back production as a result of the instability. Jet fuel prices have doubled in many regions, according to airline reports, with those costs expected to be passed on to consumers.
The Strait of Hormuz plays a central role in global energy markets, with roughly 20 percent of the world’s oil and gas transit moving through the narrow passage each day. Former officials told NOTUS that the analysts responsible for preparing for a disruption of that route were among those laid off in the administration’s restructuring.
“Before any of this should have happened, there should have been discussion about what are the implications of this, and what happens when the Strait of Hormuz turns off,” a former Bureau of Energy Resources employee said.
Former State Department officials who spoke to reporters said the layoffs significantly reduced the government’s ability to anticipate and respond to the cascading effects of the conflict. Some described the move as dismantling the infrastructure needed to manage energy-related crises.
One former staffer said the administration “dismantled the framework” that could have helped handle oil and gas prices. Geoffrey Pyatt, who served as assistant secretary of state for energy resources during the Biden administration, said the loss of expertise has had lasting consequences.
“I’m sure Secretary Rubio wishes he had that expertise available today,” said Geoffrey Pyatt, former assistant secretary of state for energy resources under the Biden administration. “Most of that institutional knowledge was lost with the elimination of the bureau and [the reduction-in-force] last fall.”
Despite warnings from advisers about potential retaliation, President Donald Trump has expressed surprise at how the conflict has unfolded. He said the administration was “shocked” that Iran retaliated with strikes on other countries in the Middle East, even though advisers had warned him of the possibility.
Iran’s response has included attacks on infrastructure and military targets across multiple countries, including Qatar, Saudi Arabia, the United Arab Emirates, Bahrain, and Kuwait. These developments have contributed to volatility in energy markets and further strained global supply chains.
Oil prices surged again following a joint U.S. and Israeli strike on the South Pars natural gas field, a major offshore energy site jointly owned by Iran and Qatar. The escalation has compounded concerns about long-term supply disruptions.
In response to the crisis, administration officials have emphasized efforts to stabilize markets. A State Department spokesperson said the agency is “coordinating the release of strategic reserves with allies and partners” and working to increase production by U.S. companies in regions including Central Asia, Africa, and the Western Hemisphere.
Energy Secretary Chris Wright said that Americans may experience higher fuel costs for “weeks,” but not longer, and announced the release of 172 million barrels from the Strategic Petroleum Reserve. Defense Secretary Pete Hegseth also sought to reassure the public, telling Americans not to “worry” about disruptions in the Strait of Hormuz.
However, experts cited in the reporting have characterized these measures as temporary. They said such efforts amount to a “band aid” on a deeper crisis driven by supply constraints and geopolitical instability, noting that only the reopening of the Strait of Hormuz could meaningfully ease shortages.
Efforts to secure international cooperation have faced challenges. Countries have rejected calls from the United States to form a naval coalition to ensure safe passage through the strait. In response, Trump said “we don’t need any help” after initially urging allies to participate.
The administration’s public statements have also highlighted a different assessment of the economic consequences of the conflict. Trump said that elevated oil prices are a “very small price to pay” for global security. National Economic Council Director Kevin Hassett similarly downplayed the potential economic impact, saying, “If [the war] were to be extended, it wouldn’t really disrupt the US economy very much at all,” and describing consumer pain as “the Last of Our Concerns.”
Recent polling indicates that more than half of Americans oppose the war against Iran, as rising fuel costs and broader economic pressures continue to affect households across the country.
The removal of the State Department’s oil and gas experts months before the onset of the conflict has drawn renewed scrutiny as policymakers and analysts assess the government’s response. Former officials have pointed to the loss of institutional knowledge, diminished analytical capacity, and reduced diplomatic engagement as factors that may have shaped how the United States has navigated the energy consequences of the war.
“I’m sure Secretary Rubio wishes he had that expertise available today,” said Geoffrey Pyatt, former assistant secretary of state for energy resources under the Biden administration. “Most of that institutional knowledge was lost with the elimination of the bureau and [the reduction-in-force] last fall.”
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