Hank Paulson Warns Iran War and Copper Shortages Threaten US Economic Stability

Former Treasury Secretary Hank Paulson has issued a stark warning about the economic fallout from the ongoing war in Iran, cautioning that the greatest risks to the US economy could stem from global shocks rippling into domestic markets. In a recent episode of Bloomberg's Wall Street Week, aired on April 17, 2026, Paulson highlighted how disruptions in energy markets—particularly if key shipping routes like the Strait of Hormuz face closures—could drive up costs worldwide, with those expenses inevitably passed on to American consumers and businesses. According to Bloomberg reports, such scenarios underscore vulnerabilities in global supply chains amid escalating geopolitical tensions.

Paulson's appearance comes at a critical juncture, as markets grapple with the Iran conflict's broader implications. He emphasized that while direct military involvement might be contained, indirect effects like volatile oil prices and interrupted trade flows pose the real threat to Wall Street stability. This perspective aligns with discussions on Bloomberg Surveillance, where experts like Port of Los Angeles Executive Director Gene Seroka noted that any Hormuz closure would amplify shipping costs, already strained by regional instability. As reported by Bloomberg, these warnings matter deeply for investors, energy firms, and everyday Americans facing potential spikes in fuel and commodity prices.

Adding to the economic pressures, the episode delved into the growing strain on copper supplies, where surging global demand—fueled by electrification, renewable energy projects, and AI infrastructure—is vastly outpacing production. Bloomberg analysis reveals significant gaps in US mining output, forcing greater reliance on imports from regions like Chile and Peru, which heightens exposure to international disruptions. This shortfall not only inflates prices but also hampers key industries such as construction, electric vehicles, and power grids, affecting manufacturers and utilities across the country.

The discussion also tackled the heated US tax debate, questioning whether the wealthiest Americans are paying their fair share or if loopholes allow too much income to escape taxation. Paulson and panelists explored reforms amid political divides, with implications for federal revenue and inequality. As Bloomberg's coverage notes, this comes as policymakers weigh budget priorities against war-related spending, potentially influencing everything from infrastructure investments to deficit reduction.

Looking ahead, market watchers are monitoring developments in US-Iran negotiations and President Trump's recent claim that the Strait of Hormuz remains "open for business," as featured on Bloomberg's Balance of Power. Energy traders and commodity analysts anticipate continued volatility, while copper producers face calls for boosted domestic output to reduce import dependence. These interconnected issues—geopolitics, resources, and fiscal policy—signal a pivotal moment for global finance, with US stakeholders from Wall Street to Main Street bracing for uncertain times ahead.