“The price of oil will drop like a rock as soon as a deal is done. I guess it already is today. We have a very serious chance of making a deal. That doesn’t guarantee anything,” Trump mused a few hours later, while talking to reporters. “All I’m saying is we are in the throes of a real possibility of making a deal. And I think if I were a betting man, I’d bet for it.”
Oil isn’t cryptocurrency, or the stock market. It is a material thing that needs to be drilled, transported, stored, refined, sold, and delivered, all at considerable cost, all over the world. In fact, it’s many things: Different grades of crude have to be processed in different facilities, into different products. Benchmark prices and futures—somewhat recent phenomena—should ostensibly enable global oil market participants around the world to manage risks, and respond to events that might impact investment and purchasing decisions. Trying to rig oil markets like a casino’s slot machine makes the information those numbers are supposed to provide less useful, warping perceptions of how much barrels actually cost and what that entails for the broader economy. It could also be making it easier to ignore potentially cataclysmic levels of disruption.
At CERAWeek—the annual global energy confab hosted by S&P Global—Chevron CEO Mike Wirth similarly noted that the market is trading on “scant information,” with prices that likely don’t reflect the actual physical shortages that mount every day as ships are unable to pass through the Strait of Hormuz. “We got a lot of oil and gas now that is not flowing into the market,” he said. “There really is a difference in terms of physical supply this time versus prior incidents.”
The Trump administration wasn’t really thinking about all that when it joined Israel in attacking a country four times the size of Iraq, according to reporting by CNN, and has been surprised by the scale of Iran’s escalation. “Planning around preventing this exact scenario—impossible as it has long seemed—has been a bedrock principle of U.S. national security policy for decades,” a former U.S. official, who served in Republican and Democratic administrations, told the outlet. “I’m dumbfounded.”
Despite Energy Secretary Chris Wright’s claims this week that U.S. oil producers are patriotically “rallying to the cause” of U.S. interventionism and lower gas prices, top executives have criticized the administration’s approach, and are weary of boosting production too quickly under such volatile conditions. “In the quarter ahead, all pricing is uncertain until safe navigation through the Strait of Hormuz can be achieved. I would think any short- or long-term planning has been put on hold for the next two to three months,” one executive reported to the Dallas Fed’s quarterly Energy Survey, released on Wednesday. Ramping up domestic oil production, moreover, won’t necessarily bring down prices at the pump here—particularly in the short term.
But which prices matter? Bloomberg’s Javier Blas pointed out that the price of WTI—while important to Wall Street, and to Trump—is far less important to ordinary consumers than the bundle of products produced from crude oil, like diesel, jet fuel, and gasoline. “Those are all individual commodity markets,” Johnston told me. “Refineries refine a barrel of crude oil into a cocktail of those products. It can change which crudes it will refine. It can change the yields. But, as a general rule, a refinery can’t turn one barrel of oil into one barrel of gasoline.” Blas writes, “While the price of Texas crude is up 60 percent since January, the cost of key everyday fuels has risen by between 85 percent and 120 percent.”
If turmoil at the Strait of Hormuz persists, the World Food Program estimates that an additional 45 million people could face acute food insecurity this year, as aid supply chains are snarled and poorer countries become unable to import and produce fertilizers ahead of key planting seasons for staple crops like rice.
The wide-ranging human costs of this war apparently haven’t registered with the White House. Pentagon officials seem to be ordering missile strikes with about as much care as they invest in summoning a burrito from Uber Eats; those tracking their macros may well spend more time deliberating between chicken and carnitas than they do considering whether a direct hit will kill 10, 20, or 150 civilians. At least 1,500 people are believed to have been killed in Iran so far.
Trump would much rather talk about gas prices than the 13 U.S. soldiers who’ve died in his pointless war, or the more than 324 children killed across Iran and Lebanon. Discussions about fuel costs, supply chains, and futures markets matter because millions of lives and livelihoods depend on them. They shouldn’t distract attention away—as the president might hope—from the thousands being starved, maimed, impoverished, and killed because of a nihilistic war of aggression waged by leaders who couldn’t care less.
Hence then, the article about trump thinks he can magically control the price of oil was published today ( ) and is available on The New Republic ( Middle East ) The editorial team at PressBee has edited and verified it, and it may have been modified, fully republished, or quoted. You can read and follow the updates of this news or article from its original source.
Read More Details
Finally We wish PressBee provided you with enough information of ( Trump Thinks He Can Magically Control the Price of Oil )
Also on site :