The OPEC Monopoly must remember that gas prices are up & they are doing little to help. If anything, they are driving prices higher as the United States defends many of their members for very little $’s. This must be a two way street. REDUCE PRICING NOW!
— Donald J. Trump (@realDonaldTrump) July 4, 2018
Image modified from King Cnut and the Waves.
Hello Mr,. President gas prices are up because of your absurd embargo on Iran.
And here’s the deal: The more effective your embargo, the higher gas prices will go.
I have a suggestion. Please study Econ 101.
Meanwhile, please note that shouting at waves will not produce results.
Mike “Mish” Shedlock
Yeah yeah, 9D chess and all that. Everyone’s heard it a million times.
If you think Trump is cleaning up this mess, or even ATTEMPTING to clean it up, you’re delusional. Take a look at central banking, then consider how absurd the notion of one person stemming that tide really is. Then take a closer look at Trump and try to ascertain whether he’s even one of the “good guys”. Just because Hillary = bad does not mean Trump = good.
Mish,
Taking Mr. Trump literally, or underestimating his competence is always a mistake. He did not fall into our presidency, or buy it. He’s there because he pays attention and knows what he’s doing. He’s smart and a tough negotiator, and apparently unconcerned about the niceties of anything. Were he otherwise, we would still be in the Paris Accord and the Iran deal, would not have the tax reform bill which encouraged domestic corporate activity, would still be burdened with the “WOTUS” rule, would still be running $600 Billion trade deficits with no intention of resisting that curse, would be appointing liberals to the Supreme Court and would not be addressing the wretched mess on our southern border. Our embassy would not be in Jerusalem and Mrs. Clinton would be expanding our federal government, and it seems likely N. Korea would still be terrorizing the neighborhood.
He’s no charmer, nor is he a member of the elite Washington establishment, which seems to have failed to govern wisely for many years. Though there’s lots to criticize, I credit him with driving some of our current expansion and decrease in unemployment (real unemployment….that is).
Ignoring the optics, I go back to his revolutionary inaugural address. Something the MSM referred to as “dark,” a characterization which doesn’t do it justice.
I understand he’s not attractive and it’s not a popular position, but if you get away from the optics, the results look like they’re good for our country.
John Goodrich
It is interesting in this context that the US National Intelligence Estimate has said several times already that US agencies do not believe Iran is developing nuclear weapons. In fact, it states that they stopped trying to do so in 2003.
Want a change? Vote for Trump! – didn’t you Misha proclaimed it? Stop whining, pick up your poison.
Apologies for any confusion caused by my attempt to be concise, Tengen. Arabian Gulf city = Arabian city on the Persian Gulf.
You do know that about half of Iranians are not Persian?
It’s the Persian Gulf. What are you, a Saudi? They’re the ones leading this dumb campaign to rename it.
Then again, you’re always hyperventilating over Iran. Merely typing the word “Persian” may offend your sensibilities.
JonSellers: “It was a great deal that would ensure that Iran would not have nuclear weapons for generations.”
No nuclear weapon for generations? Get serious! Back in the 1940s when the nuclear bomb was just a theory that no-one knew for sure would work; when the physics were poorly understood; when a computer was a woman with an adding machine and a pencil; when most national resources were being devoted to two wars in Europe and the Pacific – the US still managed to build and deliver two different types of nuclear weapons from scratch in 4 years.
Since then, many nations have built nuclear weapons in much less than a single generation: Russia, China, India, Pakistan, South Africa – even France! Common sense tells anyone that the Iranians are very close to having nuclear weapons, or maybe even have some already. The delivery system is another matter – but that would be less of an issue for the Islamists if they intend to use their nuclear weapons offensively.
Don’t trust the assurances of technologically-illiterate Barry-era Swamp Dwellers.
Jon — Don’t believe everything your Leftie professor tells you.
Ten years ago, you could not turn a corner in an Arabian Gulf city without bumping into a Venezuelan oil worker who had effectively been expelled from his native land. The Socialist oligarchy fired lots of technicians in the industry, putting political reliability ahead of competence; and then prevented those fired workers from getting any other job in Venezuela. It is no surprise that Venezuela’s oil production has fallen.
Venezuela is a rich country with a mass of well-educated hard-working people — its problems are strictly home-grown.
Oh no doubt. And actually it was Obama who started the sanctions, not Trump. But neocons gotta neocon. So here’s a little bit about Venezuela: its modern history is essentially a story about a wealthy oligarchy that took its oil riches, and immediately moved that money into US financial markets instead of investing them in Venezuelan industry that would provide a solid job market for the local population. And when the locals would get pissed, the rich simply packed their bags and moved into one of their homes in Miami or NYC. The locals got pissed enough to actually vote in Socialists. Chavez took to borrowing against whatever profits he could suck out of the oil industry to feed the population. They were happy. Then he died and left a smoldering ruin to Maduro. So its not so much a story about “Socialism Bad” as it is about decades of corruption and incompetence. Socialism just being the whipped cream on the turd.
JonSellers: “Yes, and the fact that the United States has sanctions on Venezuela that doesn’t allow their oil company to borrow on the international markets to make the needed capital investments …”
Jon! Jon! Jon! Do you think that maybe, just possibly, Venezuela’s production problems are related to the dumb actions of their own socialist oligarchy? Hint – How many years before the election of President Trump was it when Venezuela started having problems meeting its OPEC quota?
Personally, this is all good. Eventually, his supporters will be hit economically by his incompetence and will stay home next election. BTW the USA is not spending $$$ to defend OPEC countries. The USA is defending the oil supplies. That he says that he is somehow doing the OPEC countries a favor “by defending them” is pathetic and only “his deplorables” can believe that
Spot on. Trump is the anti-Canute.
Yes, and the fact that the United States has sanctions on Venezuela that doesn’t allow their oil company to borrow on the international markets to make the needed capital investments in production isn’t helping either.
Canute knew in advance that the waves would not obey him, and in fact, the point of giving the order was to demonstrate the limitations of his power. Trump, by contrast gives commands, and expects that they will actually happen.
No, they are up because Venezuela’s Oil industry is collapsing because of their Socialism. As is to a lesser extent Mexico’s. That supply isn’t something Trump’s Tweets can fix.
It wasn’t a bad deal. It was a great deal that would ensure that Iran would not have nuclear weapons for generations. In order to make a nuclear bomb, you first have to learn how to purify uranium safely. Then you have to learn how to build a nuclear reactor to turn the uranium into plutonium. Then you have to learn how to cause the plutonium to explode. Then you have to have enough of the stuff to build enough bombs to have an effective deterrent. That doesn’t even take into account the skills and abilities necessary to create a rocket-based delivery system.
Iran was only in the very first phase of all of that. And, of course, they could have been doing it for their stated purpose: to build nuclear reactors so that they didn’t need their oil to produce electricity. The agreement had a term date a couple decades down the road. And even if we couldn’t renegotiate it at that time, they’d still be a couple of decades away.
Would agree but the attempt to block = direct action.
Perfect excuse for war.
War there = higher oil price.
Blockage unlikely IMO
Some Iranian threats to choke the Gulf oil shipping lanes. US says it will keep them open. Nov 4th is a deadline. Every chance of conflict as things come to a head.
If blockage is a credible threat oil will rise as rates rise as trade slows = recession.
Not to mention direct armed face off with Iran vs US at sea.
Will the markets signal this early as probable outcome or will they continue on their merry way?
Does anyone care?
The complacency either signals nothing to worry about or stupidity.
Trump place embargoes on Iran,. Venezuela is falling apart (the military has taken over drinking water trucks so water & food come ahead of oil). The Libyan military have closed 2 more ports removing another 850,000 bopd of production. Coal is in decline and rightfully so since it is dirty and destroys the environment while extracting it. All of these factors increase demand.
On the supply side, the Permian basin in the US is limited by pipeline capacity issues. The Saudis can’t ramp up oil production quickly since they need to drill more wellswith is a slow process. Same for the Russians.
Oil will see $80/bbl before we see 60. i wouldn’t be surprised if we see $100/bbl before it drops to 40. Bottom line: Trump tweets do not trump supply/demand economics. Trump having his daily mentally unstable meltdowns. Does he stroke out or start military action somewhere first? Military action will only raise prices, if he strokes out, that will be bad for oil prices.
Yes, blatantly stupid. I was too polite with “absurd”. Even our own generals admit Iran was honoring the deal.
Absurd embargo on Iran. Really??!!