There is a principle I endeavoured to establish in the Wealth of Nations — that the free circulation of goods, of intelligence, and of pacific intercourse between nations constitutes the very arterial system of opulence. When that circulation is interrupted, whether by the monopolist's contrivance, the sovereign's caprice, or the cannon's report, the obstruction announces itself with remarkable precision in the price of things. The barrel of crude petroleum, that most modern of commodities and most ancient of geological formations, is announcing itself at ninety-seven dollars. I record this without embellishment, as the number requires none.
The occasion is this: the sovereign powers of Iran have, by report of the first day of June in the year 2026, ceased to exchange messages with the government of the United States of America. Whether this silence proceeds from injured dignity, calculated stratagem, or some deeper failure of the mutual sympathy I examined in the Theory of Moral Sentiments, I cannot say with certainty. What I can say is that the husbandmen of the global oil trade have drawn their own conclusions rapidly, and those conclusions weigh ninety-seven dollars to the barrel.
The consequences distribute themselves with the impartiality that market prices have always possessed. The manufacturers of the eurozone — those great establishments of iron, chemical preparation, and finished goods that I might once have toured with admiration along the Rhine and the Loire — report that the costs of their raw materials have risen at the sharpest rate in four years. A man who buys dear what he must use in his manufacture, and who sells into a continent grown cautious in its spending, finds his margin attended by a species of anxiety no quantity of sovereign reassurance has yet relieved.
In Britain, meanwhile, the householders discover that the value of their principal possession has declined by six-tenths of one per cent in the month of May. This is not a ruinous figure taken alone; but it arrives in concert with dearer fuel, dearer freight, and a general atmosphere of suspended intelligence between great powers that does nothing to encourage the lending of money at moderate rates. The prospective purchaser of a dwelling, already computing his interest charges with a furrowed brow, now computes also the direction of the oil price, and defers.
I have written that defence is more important than opulence, and I maintain that position. But the student of political economy will observe that the line between a posture of defence and a condition of mutual commercial ruin is a line that statesmen have historically been slow to perceive until they have already crossed it. Ninety-seven dollars is a legible marker on that road. Whether those who placed the barrier that raised the price will read the marker is, as yet, an open question.