Massive debt makes the U.S. one of the world’s most vulnerable countries in the energy crisis, market veteran warns

The world has never faced a crisis while loaded with so much debt, making the U.S. especially vulnerable despite being the world’s biggest oil producer, according to Ruchir Sharma, chair of Rockefeller International, the global investment strategy arm of Rockefeller Capital Management.

In a Financial Times op-ed on Sunday, he warned that this lack of fiscal breathing room leaves indebted governments with little ammunition to fight the energy shock caused by President Donald Trump’s war on Iran.

History shows similar crises have blown up budgets. Oil shocks during the 1970s represented a turning point where governments started running deficits constantly instead of just occasionally, Sharma pointed out.

As a result, the average government debt level for G7 countries has soared to more than 100% of GDP from only 20%. And total global debt rose last year at the fastest pace since the pandemic, hitting a record $348 trillion, or more than three times global GDP.

With one-fifth of the world’s oil and liquified natural gas bottled up in the Persian Gulf,........

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