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Price of crude oil almost back to pre-Iran war levels

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wing2000

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mark46 said:
Even a partial opening of Hormuz should keep crude oil prices at near pre-war levels.

A full opening would likely lead to larger decreases. Countries have taken many steps to deal with lower supply for the Middle East. Also, the world economy is down some, thus leading to lower demand.

More critical than oil is the supply of natural gas and fertilizer.
Click to expand...

...over a month later. Price of crude passed $100 barrel this week...again.

The MOU is dead.
The Strait of Hormuz is closed.
The Houthis are threatening Bab el-Mandeb Strait, have struck at least one vessel this past week.
Oil supplies are very low.
China oil consumption is rising (China's reduced consumption earlier this year helped temper oil prices earlier this year).
...and the summer vacation (driving) season is here in Europe / US.


“The key buffers that got us through the first months of the supply shock have been worn away,” said Ben Cahill, an energy scholar at the University of Texas at Austin. “It will be harder to avoid a price correction and a steep price reaction when new disruptions are happening each day. They are already having a bigger impact on market psychology now.”

 
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mark46

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wing2000 said:
...over a month later. Price of crude passed $100 barrel this week...again.

The MOU is dead.
The Strait of Hormuz is closed.
The Houthis are threatening Bab el-Mandeb Strait, have struck at least one vessel this past week.
Oil supplies are very low.
China oil consumption is rising (China's reduced consumption earlier this year helped temper oil prices earlier this year).
...and the summer vacation (driving) season is here in Europe / US.


“The key buffers that got us through the first months of the supply shock have been worn away,” said Ben Cahill, an energy scholar at the University of Texas at Austin. “It will be harder to avoid a price correction and a steep price reaction when new disruptions are happening each day. They are already having a bigger impact on market psychology now.”

Click to expand...
With regard to oil supplies, they are only low in certain countries. The US has few issues. The situation is the same in China and Japan.

September crude oil prices will go up, and the companies will gouge US customer.

Of course, Trump is unpredictable, just as he wishes. Obviously, trusting Netanyahu's analysis was a huge mistake.

Signing a deal with the Saudis and then demanding conditions is really bad strategy. Chinese engineers are quite capable of running nuclear plants as are French engineers (and Canadian ones). Curiously, the Saudis may need to make deals with China and still continue to work with other Arabs on a solution to Gaza.
 
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Nithavela

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wing2000 said:
....yes, $5.01 on June 14th.
Click to expand...
Will $3 gasoline at the time of the election really make that much difference to the voters? If so, Trump can accomplish that result.

My point was that gas prices go up and down, often in response to world events and US sanctions policy.

Trump sanctions on Iranian oil drives up prices.

New congressional sanctions on Russian oil would drive up prices.

Trump sending Vance to a meeting in Pakistan would lower prices (and every time thereafter).

Trump bombing the nuclear sites again would lower prices. After all, Trump could then declare victory and withdraw.

I suspect that the oil crises at the two choke points will settle down, likely with the Gulf states paying administrative fees to Iran. Even fees of $5 a barrel would likely bring prices back to where they were to start the year. Much has been done by many countries that will have the effect of lowering gas prices. [By the way, the biggest recent event that will change oil prices for a long time is NOT this silly war. The big event was the UAE pulling out of OPEC, the group that has kept the prices artificially high].

The key to Middle East peace is to wait for a new Israeli government, after which the Gulf states and Israel will be able to negotiate with Israel regarding the future Gaza.

As an aside, the Houtis are largely irrelevant. If they become a real issue, Trump will again bomb them, with the support of the Gulf States as occurred last time. There is good reason why the Houtis have done little since their last disruption.
 
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wing2000

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mark46 said:
Will $3 gasoline at the time of the election really make that much difference to the voters? If so, Trump can accomplish that result.

My point was that gas prices go up and down, often in response to world events and US sanctions policy.
Click to expand...

Sure. But say, when is the last time a U.S. President's actions had such a direct impact on the price of oil?


mark46 said:
Trump sanctions on Iranian oil drives up prices.

New congressional sanctions on Russian oil would drive up prices.

Trump sending Vance to a meeting in Pakistan would lower prices (and every time thereafter).

Trump bombing the nuclear sites again would lower prices. After all, Trump could then declare victory and withdraw.

I suspect that the oil crises at the two choke points will settle down, likely with the Gulf states paying administrative fees to Iran. Even fees of $5 a barrel would likely bring prices back to where they were to start the year. Much has been done by many countries that will have the effect of lowering gas prices. [By the way, the biggest recent event that will change oil prices for a long time is NOT this silly war. The big event was the UAE pulling out of OPEC, the group that has kept the prices artificially high].
Click to expand...

That analysis seemed more likely to play out after the MOU was allegedly signed. Today? ....not so much. There is no end game in sight that I can see.

mark46 said:
The key to Middle East peace is to wait for a new Israeli government, after which the Gulf states and Israel will be able to negotiate with Israel regarding the future Gaza.
Click to expand...

....and that will occur when?

mark46 said:
As an aside, the Houtis are largely irrelevant. If they become a real issue, Trump will again bomb them, with the support of the Gulf States as occurred last time. There is good reason why the Houtis have done little since their last disruption.
Click to expand...

We've been periodically bombing the Houtis for several years now....yet, they're still around. I think you're underestimating the impact they can have. Two Saudi oil tankers were reportedly struck in recent days. Other vessels have made abrupt u-turns, choosing not to risk being hit. Iran has reportedly sent IRGC commanders to the country. At the very least, ship owners will direct their ships to take alternative, costly routes to avoid the area.


We'll see what develops.....
 
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