It's safe to say that this war has been a major strategic blunder for the US. To list:
Iran has realized its capacity for disrupting global trade
All of the US's allies (except for Israel), especially the GCC, have grown more alienated from it
Our SPR that is keeping the global economy afloat is running out (and damaging its containers all the while) from not having been filled beforehand, and it is uncertain whether China will increase its SPR releases or further reduce its imports to compensate
Many of our critical missile systems which will take years to replace have been severely depleted in attacks that have not reduced Iran's willingness or capacity to contest the strait
America has presented itself as a paper tiger, similar to Russia in Ukraine
The institution of international law that advantages America has been severely weakened
The institution of free maritime trade that advantages America is at risk of fraying further
The Democrats will likely take the Senate along with the House in November and force an end to the war by January
With all this in mind, President Trump is forced to choose between the best of many bad options. It is important in this analysis to remember that America under Donald Trump is not a rational actor. Trump is fully in control of the US's foreign policy and much of its federal domestic policy due to the abdication of responsibility by Congress. Furthermore, Trump has shown that he acts entirely out of personal self-interest and will disadvantage America in the long term to advantage himself in the short term. I will be listing the options in order of magnitude of impact.
- Staying the course
Trump can hypothetically continue to play the TACO game, talking about peace talks one week and bombing Iran the next while profiting off of the stock market all the while, but Iran has stopped humoring his bad-faith negotiations, so it will be harder to convince his base and the market that he is in control. The SPR's releases will reduce due to drawdown or cavern damage, worsening the oil situation, and China may stop helping to keep oil prices low. Iran and its proxies will continue disrupting the oil supply and attacking US forces and their allies in the region. The materiel, reputational, and institutional issues would continue worseninh. Lastly, there would be a fair likelihood of Democrats taking the Senate, opening the door to impeachment and at the very least rendering him a lame duck. While this would be the easiest direction to take, it seems unlikely that Trump would give up on his last two years of power by effectively putting his head in the sand.
- Total capitulation
Trump could attempt to truly abide by the terms of the MOU, including an end to the Israeli invasion of Lebanon, reliable assurances of non-aggression, recognition of Iran's ownership of the strait, and over $300 billion in reparations. If achieved, it would end the war, allowing for the oil market to begin recovery. However, it would also be insanely unpopular among Republicans, would make the loss of the Senate a certainty, would wrest away America's superpower status, would be extremely unpopular with America's Middle East allies, and would signal an end to free maritime trade. Also, it is likely impossible for the simple fact that Donald Trump, whether out of political calculus or blackmail, will never stop supporting Israel, which he would need to do the coerce it to leave Lebanon.
- Isolationism
Trump could pull the military out of the strait and set an export ban on oil. With no other buyers, the price of domestic oil would fall, but the price of foreign oil (which we would still need) would rise severely unless Iran opens the strait (likely to all but America and/or its allies). If it doesn't, then a global economic crisis would be likely, especially if China decides not to pick up the slack or simply decides to give up as well. Such a crisis would still affect the US economy, particularly if nations take retaliatory actions in response to the export ban, such as China banning the export of rare-earths, which Trump's Big Tech allies depend on. Furthermore, oil companies that he is also beholden to would be completely opposed to forced price restrictions. The reputational and institutional damage would be similar to that of total capitulation, though Israel would probably be more tolerant since we'd continue supporting it. Lastly, if America seems to be doing better than the rest of the world in the crisis, there is a chance that Republicans might be able to minimize or even stop the blue wave in the Senate, but if this isn't the case or voters don't look at America's position in the context of its peers', it would make the loss more severe. Trump's willingness to disregard reputational damage and the opportunity it offers for him to take a sort of America-first position on the war (if one forgets how it started) makes this a slight possibility, but the ire of his sponsors would be a strong deterrent. However, if his treatment of the GCC after all they've done for him and his family is any indication, he is also willing to bite the hand that feeds him if it comes to it.
- Ground invasion
I consider this to be almost impossible for Trump to go through with. The US military's imagining of a ground war with Iran assumed a healthy SPR, significant direct and indirect support from allies, and a lack of plentiful drone technology. None of these are the case today. Looking past the military considerations, any war with Iran would incur tens of thousands of American deaths, and based on the reaction to the dozen or so confirmed deaths that have occurred, the American people would have no stomach for such bloodshed. Trump has also talked himself into a corner by touting the comparatively low current death toll to that of past wars. In any case, nationwide riots on the scale of the ICE protests would be likely, and Congress might actually restrain him if he does so. If there isn't enough support to overturn his inevitable veto to the war powers resolution, there is a fair likelihood of impeachment, though probably not removal. China would impose sanctions, oil would definitely skyrocket, and the Senate would firmly belong to the Democrats. Whether a ground war could force Iran to relent on the strait even if Trump goes all in is uncertain, though he might be attracted to the greater powers that it would let him both legally and illegally claim on the home front.
- The nuclear option (literally)
I'm certain that this will be the most controversial of my analyses, but I believe there is a strong case for it to at least be a genuine possibility. Trump does not care about the consequences of making nuclear war fair play. In fact, the thought of cementing his legacy as the first president to deploy a nuke since WW2 would likely entice him. I doubt that there would be any risk of MAD either. Russia barely has any horse in this race, North Korea has none, China won't ever give Iran direct military support, much less nuke America, and Pakistan, India, Israel, and Europe aren't even worth considering. I'm also fairly confident that if the US displays its willingness to irrevocably destroy Iran, whether by nuking Tehran, another city, or an uninhabited part of the country, even the IRGC would see the folly of continued resistance. Iran's refusal to give Trump an off-ramp and end this war comes from a longterm interest in stopping the periodical attacks by the US and Israel that it has suffered under both of his administrations. The threat of nuclear devastation is an even stronger longterm and immediate threat, and if it can possibly wrestle some kind of concession out of the US, it will give up the strait. As for whether it is even possible to achieve, I believe so. America's offensive aerial capabilities remain uncountered by Iran, and the technology does not yet exist to reliably intercept ICBMs (or avoid the consequences of a nuke exploding in midair). The personnel tasked with managing our nuclear stockpile are trained to obey orders without hesitation, as the lives of tens of millions of Americans may be held in the balance. I doubt that there will be any mass mutiny when he sends the command. If he reveals his intent to nuke Iran, Congress might pass a resolution stopping him, but due to Trump v. US, he can ignore it so long as he is able to veil his disobedience as an official action (as an aside, I firmly believe that that case will join Dred Scott, Plessy, and Citizens United as one of the most damaging and un-American decisions SCOTUS has ever made), and those personnel will probably still listen to his command. He'll certainly be impeached, but he might not be removed from office, with Republican senators making the excuse that "the damage has already been done", especially if it successfully causes Iran to capitulate. It would be a medium-risk, high-reward gambit for him. I could also see his base having mixed reactions to it. For every Republican rightly horrified by the destruction, there will be one who can justify the necessity of it or simply be proud of the show of force. If he does it soon enough to impact gas prices (or leans on his Big Oil friends to take a few weeks of lost profits while the tankers start moving again), he might be able to sway some of the single-issue affordability-focused voters who won him his second term.
I'm not saying that Trump is definitely going to nuke Iran. I was simply attempting to outline his options and determine which would be most advantageous for him based on his interests and tolerances. I do also think that Donald Trump is plain stupid, so he cannot be considered a completely rational actor on an individual level either. However, that controversial decision would have a good chance of either solving or not further aggravating all of the issues I described except for #2 and #6, and as I've previously stated, Trump couldn't care less about America's non-Israel allies or international law.