Aaron Brown, Columnist

The Iran War Just Broke the Petrodollar

April 6, 2026 at 4:01 AM UTC

Aaron Brown is a former head of financial market research at AQR Capital Management. He is also an active crypto investor, and has venture capital investments and advisory ties with crypto firms.

Oil tankers anchored at Muscat Anchorage near the Strait of Hormuz.
Photographer: Elke Scholiers/Getty Images Europe

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The virtuous loop that has seen America underwrite stability in the Middle East in exchange for Gulf states recycling their dollar revenues into US Treasuries has been broken.

The understanding traces back to 1974, when Henry Kissinger struck one of the most consequential financial deals in modern history. Saudi Arabia would price its oil in dollars and park the surpluses in US assets — Treasuries above all. Other Gulf states followed. In exchange, America provided security guarantees and a stable global order.