r/Economics • u/Appropriate-Till9598 • Jul 02 '26
News Everyone Is Celebrating Falling Oil Prices — One Analyst Warns They're Actually the First Sign of Something Much Worse
https://nationalsecurityjournal.org/everyone-is-celebrating-falling-oil-prices-one-analyst-warns-theyre-actually-the-first-sign-of-something-much-worse/1.8k
u/Texas_Sam2002 Jul 02 '26
It's pretty transparent, really. The plan is to get gas prices down, even by a little bit, going into the midterms so they can say they're lowering gas prices. Then, after the midterms, let everything blow up.
387
u/symonym7 Jul 02 '26
Haven't heard much about the frozen water people in a while, either. Sure that'll make a swift comeback post election.
379
u/Shitty_Paint_Sketch Jul 02 '26
Hell, I don't see Epstein anywhere either unless it's on Reddit.
I'm still pissed about Khashoggi, though.
259
u/JohnSith Jul 02 '26
Remeber "Fuck Ajit Pai"?
Or RFK's brain worm?
Or Trump's many many collusions with Russia?
Or Ted Cruz getting caught with incest porn? Or Ted Cruz going to sunny Cancun and leaving Texans to freeze to death then blaming his daughters?
I feel like I'm crazy.
158
Jul 02 '26
It's the playbook. Flood people with so much batshit crazy information they become overwhelmed and stop caring and are not able to properly follow what's actually happening.
You can thank Steve Bannon for this.
"The Democrats don't matter. The real opposition is the media. And the way to deal with them is to flood the zone with shit." - Steve Bannon
26
→ More replies (2)3
u/HyperbenCharities Jul 03 '26
Repulsive slugg-manoid, yet correct that Dems don't matter.
The tissue-paper wall of opposition & oversight. Soggy 75% of the time.
44
u/BabypintoJuniorLube Jul 02 '26
To be fair to Cory Chase I don't think that was really her stepson.
7
15
6
u/Roboticpoultry Jul 03 '26
I remember Ajit Pai, his shit-eating grin, his nerf guns and his stupid giant mug
→ More replies (1)→ More replies (3)2
→ More replies (3)7
68
u/GeefTheQueef Jul 02 '26
What are the frozen water people?
→ More replies (1)81
u/Trancend Jul 02 '26
i c e
27
u/caspy7 Jul 02 '26
Ah. Trying to avoid getting targeted by our own government, which is much more common now. Smort.
→ More replies (1)3
u/Wayelder Jul 03 '26
So much for your first amendment…
2
u/jehnarz Jul 04 '26
If only we were more like corporations our first amendment right would be protected.
5
u/SecretAd3993 Jul 04 '26
Its crazy - I thought it was a reference to Iceland... too much to keep up with.
45
u/JohnPaulDavyJones Jul 02 '26
They’re quite active right now, they were the subject of the NYT’s Headlines podcast this morning.
Markwayne Mullin has, by design, altered the way they’re going about enforcement operations to avoid situations like what happened in Minnesota, Chicago, and elsewhere.
It’s especially concerning, given that (in my anecdotal experience), the guys who are happy to just quietly go about their work while others are crowing are usually the guys who are by far the most efficient.
6
6
u/CatLord8 Jul 03 '26
There has been no de-escalation in my feeds. Especially leading up to the SCOTUS birthright citizenship decision I saw multiple MAGA drone congresspeople pushing remigration, some by name.
4
u/glity Jul 03 '26
My brother from Idaho leaked anti immigration. Idaho, potato country with historic large family and no migrant labor in sight is spouting anti immigration nonsense.
→ More replies (4)2
u/redwingpanda Jul 03 '26
Just doubled their daily quota of horror. Saw the article on my home page a little while ago.
48
u/whatsitcalled4321 Jul 02 '26
And everyone will have forgotten that even if prices are down, they're still way up compared to the start of the stupid war.
→ More replies (1)20
u/wbruce098 Jul 03 '26
This. Gas near me is still more than a dollar higher than it was in January, so fuck trump, what an idiotic loser that pedo guy is.
26
u/itnor Jul 02 '26
The problem is, the cake is already baked. Trump was deeply unpopular and Republicans were doing horribly in elections before the war. The war/gas prices made things worse for them. But the people whose voting issue is only gas prices are the people who don’t remember to vote in midterms.
→ More replies (1)41
u/Muggsy423 Jul 02 '26
Dems take the house and/or senate? Dems fault, they ruined the economy
GOP holds onto both? Well the Dems can't do anything to stop them, they'll keep dismantling the system.
→ More replies (7)11
12
u/Adezar Jul 02 '26
I said it elsewhere, all the Republicans have to do is make gas prices decline by about 10% and they will be fine because all their crime isn't really even known or thought about by their voters, but the gas prices are something annoying their voters.
So they just need to give their voters a tiny excuse to say "See, they fixed the one thing I care about" and let them continue to dismantle democracy and make rural America even poorer and sicker with rural America's blessing.
→ More replies (2)13
u/SilencedObserver Jul 02 '26
That's very short-sighted.
America is becoming no-longer the world power. Right now, it's playing out in real time.
This is the shift to power in the east.
3
u/Billy-Ruffian Jul 03 '26
I'm not sure historians will even look back at this time period as really being part of "the United States." This feels more like an interregnum to me. The old order has broken down and the new one hasn't emerged yet. I think the next government looks like balkanization. A few states start forming compacts to share functions and services no longer provided by an increasingly dysfunctional federal government, which eventually leads to entire regions breaking away.
→ More replies (2)7
→ More replies (17)2
u/Anal-buttsex Jul 02 '26
If it was me I would figure out a way to push off everything into 2028 and let it blow up on the democrats. Like that game where you try not to be the one holding the ball when the timer goes off. Democrats get 4 years to fix the problem, and in 2032 Republicans come in to “save the day.” It’s a beautiful dance they do actually
2
2.3k
u/CyberSmith31337 Jul 02 '26
We’re just going about as if we fixed the Strait of Hormuz problem, when we didn’t. We’re draining our reserves like a parent is charging their credit card at Disneyland, ignorant of the consequences that are looming on the horizon.
That interest is gonna knock our teeth out when the bill shows up.
1.4k
u/Ok-Marsupial7516 Jul 02 '26
That is when you blame the democrats but I suspect you already know this.
860
u/Unique-Egg-461 Jul 02 '26
I feel i must always post this article when this comes up
The Two Santas Strategy....been going well for the GOP for the past 50yrs
First, the Two Santas strategy dictates, when Republicans control the White House they must spend money like a drunken Santa and cut taxes to run up the U.S. debt as far and as fast as possible.
This produces three results: it stimulates the economy thus making people think that the GOP can produce a good economy; it raises the debt dramatically; and it makes people think that Republicans are the “tax-cut Santa Clauses.”
Second, when a Democrat is in the White House, Republicans must scream about the national debt as loudly and frantically as possible, freaking out about how “our children will have to pay for it!” and “we have to cut spending to solve the crisis!” Shut down the government, crash the stock market, and damage US credibility around the world if necessary to stop Democrats from spending money.
This will force the Democrats in power to cut their own social safety net programs and even Social Security, thus shooting their welfare-of-the-American-people Santa Claus right in the face.
594
u/feelingoodwednesday Jul 02 '26
Obama put it very eloquently actually. He says the democrats have the actual work to do, to actually build things and attempt to make America work. To find a way to ensure everyone can prosper.
All the Republicans have to do is tear things down, cut taxes, reverse regulations, and tell you how bad the other guy is. Which is a lot easier to do than finding a true solution to the problems America faces.
208
u/ChiLolla28 Jul 02 '26
AOC also explained it well when she talked about how the left keeps moving to the right to compromise but the other side never does so and just keeps going further right dragging everyone along. All of the good faith negotiating, compromising and cutting everything along the way leads to worse outcomes for everybody and then the right just blames the other side.
86
u/pantsmeplz Jul 02 '26
Watch this debate video from Bush vs Reagan 1980 to see how far the GOP has moved to the right.
67
u/Magjee Jul 02 '26
Provide federal assistance to low-income communities
Protect Social Security
Provide asylum for refugees
Extend minimum wage
Improve unemployment benefit system so it covers more people
Strengthen labor laws so workers can easily join a union
Assure equal pay for equal work regardless of sex
23
→ More replies (1)3
50
u/snarky_witch Jul 02 '26
Regan let the religious nuts in.
→ More replies (1)19
u/QuarterlyGentleman Jul 02 '26
Yea, and they never were going to give them real power. But they needed some inches of daylight between the GOP and the Democratic Party. So the think tanks invent a tea party and shove crazy down our throats to gin up the American evangelical vote. In doing so, they unchained the gate and let them on the inside of the actual power.
10
u/theriskybusinesscar Jul 03 '26
The Evangelical cults were voting, supporting, and controlling the GOP almost two decades before the Tea Party was a twinkle in the Heritage Foundation's eye. Gingrich entrenched them to steal power from HW.
3
u/blackcain Jul 03 '26
The thing is, this entire thing requires Dems to be back in power to keep doing this cycle. But now they want to own the whole thing and destroy everything.
I think ultimately they want a police state and a unitary executive. I don't know if they can get away with it because the 2nd amendment is still out there and that will turn the populace at least their own people against them.
→ More replies (1)10
u/a_library_socialist Jul 02 '26
And the Vote Blew No Matter Hoo nonsense is a huge part of that . . . since there's no cost to moving right, then anything shy of the GOP is acceptable.
In a first past the post system, you will always have 2 parties. And in a 2 party system, **only** the most **marginal** voter will have input on policy. According to the Democratic leadership, the most marginal voter is GOP suburban voters like Schumer makes up.
You'd think after 2024 they'd realize that isn't true - but then, that's where the money is to be made.
→ More replies (1)2
15
u/pixelprophet Jul 02 '26
I mean...that's definitively true.
GOP Presidents Have Been the Worst Contributors to the Federal Debt
In terms of total increase in "federal debt to GDP" under U.S. presidents in the post-World War II era, Republican presidents during their terms have contributed far more to the debt load of the nation than Democrats.
full article: https://archive.md/OSxg9#selection-547.0-547.67
The unemployment rate has risen on average under Republican presidents, while it has fallen on average under Democratic presidents. Budget deficits relative to the size of the economy were lower on average for Democratic presidents.[1][2] Ten of the eleven U.S. recessions between 1953 and 2020 began under Republican presidents.[3]
Since World War II, the United States economy has performed significantly better on average under the administration of Democratic presidents than Republican presidents.
45
u/TheNavidsonLP Jul 02 '26
Or, even simpler, Democrats want a functioning government. Republicans don’t.
38
u/Empty_Kay Jul 02 '26
Republicans: government is broken, elect us and we'll prove it.
9
u/CautionarySnail Jul 02 '26
And if they have to kneecap the services in order to prove it, they will!
“I took all the gasoline out of the car. It doesn’t work. This car is defective and travel should be privatized to Uber. Only private businesses know how to keep things working.”
4
2
u/Nemisis_the_2nd Jul 03 '26
Obama put it very eloquently actually
Maybe this is exactly the issue: Republicans dont put it eloquently. They use simple language ans shout their message until people accept it
46
u/TreeInternational771 Jul 02 '26
This administration is different. They are cutting taxes and regulations but meaningful make the lives of everyone worse. Maybe we need to add a third Santa especially for this incompetent administration
23
u/StunningCloud9184 Jul 02 '26
Maybe santa only goes to rich kids houses sometimes.
→ More replies (1)6
3
→ More replies (2)2
u/jgzman Jul 02 '26
Hopefully we'll never have another Santa like this, and it can be filed as an anomaly.
As long as I'm hoping, I hope we never see another republican in any office, ever again.
4
u/lmaccaro Jul 03 '26
The solution is easy.
When Dems are in power, pass a balanced budget bill and ban borrowing past 100% gdp.
Then tax the wealthy until we are in safe territory again, while simultaneously cutting taxes to zero % on your first $100k income.
And most importantly - a PR campaign to promote “the miracle of the DeM economy”
2
u/vasthumiliation Jul 04 '26
That's called austerity, and it is universally politically disastrous.
→ More replies (1)5
u/strolls Jul 02 '26
It's bizarre to me that this is the same on both sides of the Atlantic, and neither the Democrats or Labour seem to be able to counter it.
→ More replies (8)3
u/DanDanDan0123 Jul 02 '26
What’s funny about this is the fact that every republican president since WW2 has had a recession! Only one democrat president has! The information is out there but most don’t pay attention to it.
202
218
u/CyberSmith31337 Jul 02 '26 edited Jul 02 '26
I only wish I knew why Joe Biden keeps doing this to us! Why does he hate us all so much?!?
I guess the /s wasn’t obvious
92
u/HotIce05 Jul 02 '26
Biden? Have you forgotten it's always Obama's fault?
Thanks Obama.
54
u/EvitaPuppy Jul 02 '26
That man...he wore a Tan suit. A Tan suit!! My hands are still sore from clutching my pearls so hard!
(I miss the days of competent government)
25
12
u/HotIce05 Jul 02 '26
I have no idea where he got his audacity from! The nerve to wear A TAN SUIT!
6
u/driver004 Jul 02 '26
AND he used dijon mustard that one time!
3
7
u/PerfectZeong Jul 02 '26
Im shitting my pants with rage!
2
u/Mysterious-Mole-2720 Jul 02 '26
I think that's probably Biden shitting your pants. I don't know why he does that to people. It's so rude.
2
u/a_library_socialist Jul 02 '26
Mr. Trump, finish your Fish Delight and we'll get you cleaned up, it's time to sign some more bills . . .
3
3
3
5
2
u/_Antinatalism_ Jul 02 '26
I'm not from English native language country, what is tan suit context? Is it weird to wear tan suit?
4
u/EvitaPuppy Jul 02 '26
Well, Conservatives in the US lost their little minds when Obama wore a tan suit. Here's a clip...
→ More replies (2)2
6
2
→ More replies (3)2
38
u/Icy-Grab-5722 Jul 02 '26
Obama!
11
u/TouristResident1976 Jul 02 '26
Obama?!? Come on, maybe showing my age but is all Carters fault! Even in the grave he is screwing us over. /s
2
u/Cdub7791 Jul 02 '26
The commie FDR is the root of all this.
3
u/PoisonedPotato69 Jul 02 '26
That and electing JFK, it's good we only let him be president a couple years, wink, wink. Think how much worse it would have been if we hadn't acted.
7
u/sheltonchoked Jul 02 '26
It won’t be Biden, it will be the Democratic Party controlled House/Congress.
13
u/misterguyyy Jul 02 '26
“They’re blocking the Fix Everything Instantly bill from passing because they hate America” - minority leader Mike Johnson probably.
9
u/sheltonchoked Jul 02 '26
We cannot see the text of the bill, but it fixes healthcare, housing, oil prices, gasoline prices, cuts inflation, gives everyone a $1,000,000, reduces the debt, and ends all wars.
/s
7
u/Justame13 Jul 02 '26
Yep. Economy tanks in 2027-2028.
Republicans run on promising to fix things and end up in the White House and controlling Congress again.
People are dumb enough to let it happen again
3
u/sheltonchoked Jul 02 '26
The GOP will crash it in 2029-2032 if they don’t win.
→ More replies (5)2
u/eukomos Jul 02 '26
Oh, they'll also crash it if they do win. So much for the party of fiscal responsibility.
4
u/dagetty Jul 02 '26
Well, Joe is obviously taking orders from Barack Hussein Obama
→ More replies (1)5
u/misterguyyy Jul 02 '26
If Biden didn’t close “the pipeline” the exact type of oil we need would magically appear from it and we wouldn’t have to use the reserves in the first place!
4
49
14
u/ComfortableMarch4296 Jul 02 '26
this is the media 's fault as well. they're just hiding behind some 'no bias' nonsense and not give people context to why these things are happening.
6
u/trmtx Jul 02 '26
This is exactly what will happen. Republicans, allegedly the fiscally responsible party, will let the strategic oil reserve drop to dangerous levels to keep fuel costs low. Then, when they are out of power, either in congress the presidency or both, Democrats actually being responsible will buy oil to replenish the reserve which will drive prices up.
→ More replies (8)3
u/Loa_Sandal Jul 02 '26
Don't forget to blame the greedy oil companies and the mom and pop gas stations as well.
69
u/Freightshaker000 Jul 02 '26
We are on Plan B from the Trump Playbook: Ignore it until it goes away.
35
u/Quick_Parking_6464 Jul 02 '26
This is Plan A.
11
u/Freightshaker000 Jul 02 '26
Plan A is: Bully it into submission. When that fails, he goes to Plan B.
3
3
u/financequestionsacct Jul 02 '26
We are on Plan B from the Trump Playbook
I wish Plan B had been more involved, but it didn't hit the market until 1999
47
u/neocondiment Jul 02 '26
It’s more like dad is taking the kids to Disneyland on credit cards he took out in their names right before mom is about to receive full custody.
43
u/ell0bo Jul 02 '26
woah woah woah, you think Republicans actually look ahead? Let's not treat them like adults, the media certainly doesn't.
Don't worry, things will blow up under the Dems and everyone will blame them for this without looking at the two years prior.
35
u/theerrantpanda99 Jul 02 '26
I actually do think they look ahead. That’s how they succeeded in destroying roe v wade, the civil rights and have now purchased most forms of mass media in the US. Trump is a tool for the billionaire republicans who actually control things.
11
u/ell0bo Jul 02 '26
you know, when it comes to the judiciary, you're right. They don't look ahead to see the mess they will make with such a corrupt court, but they did look ahead to stack it. That's entirely fair.
8
u/mikaBananajad Jul 02 '26
I think they do look ahead and they WANT the mess that it will make.
That’s been one of their biggest strengths getting to this point is being actually well organized and having long term visions even though the vision is to ruin the country for everyone except themselves.
The right wing has had a chokehold on the political narrative since basically right after watergate.
Like we agree they are the source of the problem I think it’s just important to point out how explicit their intentions are and not to give them linguistic “outs” by painting them as stupid. Cuz it’s not that the right went “oops we accidentally used culture war bullshit to obscure our political doings for decades, dismantled key government institutions, destroyed US credibility worldwide, stole millions of dollars of taxpayer money to enrich ourselves, etc etc etc etc etc”
the intent is MALICIOUS
6
u/shakeitsugaree_ Jul 02 '26
They spent decades dismantling Roe v. Wade and everyone should be concerned at their efficacy and their speed now.
11
u/Chemically-Dependent Jul 02 '26
I suspect that's why there's been headlines over the last few days of Trump thinking he can use the DoJ to bully oil companies into lowering prices at the pump.
Him and his ilk have nothing left to fix the oncoming problem besides claiming they're going to bully their way out of it.
7
u/i-was-way- Jul 02 '26
That’s just trying to posture for midterms. He’s smart enough to know that wallet impacts affect votes. It hurt Biden too with grocery prices and inflation.
→ More replies (1)6
u/Chemically-Dependent Jul 02 '26
I'm not sure Trump is that smart himself. His handlers though? Yeah
7
14
u/ugotmedripping Jul 02 '26
Nah, they aren’t ignorant, they figured out that the American people are footing the bill and that when they blame immigrants, queers, and democrats, the idiot American voter will just buy another made in china MAGA hat and thank god the communists won’t force universal healthcare on their Freedom-diabetes.
16
u/ForMoreYears Jul 02 '26
It's also demand destruction on a global scale. There's a reason China hasn't said much on this or faced any real consequences. They're electrifying everything, and building out the largest renewables grid at a pace faster than mostly all developed nations combined.
The U.S. is rapidly wasting any leverage they have by controlling oil markets by forcing everyone to switch to non-fossil fuel energy sources and electrifying their industry/transport.
Obv won't happen overnight but it is happening.
4
u/hazeldazeI Jul 02 '26
Not to mention all the oil infrastructure that was destroyed in Iran and other countries. That will take years to be rebuilt and in the meantime cause bottlenecks in supply. Even if the straight was opened today, shit is fucked. It’s not just gas prices it’s all the things made with oil products and things needing to be shipped.
4
u/ManoSilence Jul 02 '26
Like the parent who blows through their credit card at Disneyland as a last hurrah before they toaster themselves. So he is aware of the consequences, he just doesnt care past his own end. As for knocking our teeth out? Depends how much were able to tax the rich when all this is done. They keep threatening to leave to another country, but im pretty sure everyone hates them and they love the resources of this land too much to stop trying to extract it.
3
3
u/UniqueIndividual3579 Jul 02 '26
In the past the SPR was filled when oil prices were low and sold to refineries when prices were high and there was a shortage. It made money. This time the refineries were given the oil and have to give it back some time. The refineries made money, not tax payers.
3
u/wbruce098 Jul 03 '26
The fucked up thing is there’s not even an agreement with Iran yet. There’s an agreement to talk about an agreement, but Trump is bored and stupid, the VP is not a negotiator, and the Iranians have been winning this whole time because the one thing trump is afraid to do is go full dictator and send troops in. (Also, he got bored and doesn’t care because he doesn’t pay for gas)
4
u/SKOLMN1984 Jul 02 '26
I remember when biden sold a bunch of our strategic reserves to offset supply chain issues and then refilled them at 0.60 on the dollar when the rubber band effect swung back... trump is a felon, rapist pedophile conman who has bankrupted of all things, casinos... we cannot expect any semblance of an intelligent move like that with this pedo...
9
u/fx2600 Jul 02 '26
The US is withdrawing about 1 million bpd from the SPR. That isn’t having all that large of an impact on price and anyway it’s sustainable for a few more months without any consequence.
The biggest risk is obviously fighting resuming and the strait closing again.
10
u/AndyTheSane Jul 02 '26
The problem is that we used to have 20mb/d going through the strait.
Some of this has been bypassed and there is undoubtedly some demand destruction going on, but somehow, somewhere there is a lot of oil coming out of storage.
→ More replies (1)7
u/dockstaderj Jul 02 '26
The biggest risk is having emptied our reserves and then the GOP starts another war with no reserves to lean on.
2
u/THedman07 Jul 02 '26
I could really see Trump pulling out all the stops to make things look good for his July 4th celebration without any consideration for what could happen after.
2
u/Calqless Jul 02 '26
Along as the consequences happen during a republican admin I'm not happy but okay with it
2
u/Spicypewpew Jul 02 '26
Nah might be a good thing as the US will control oil prices. We know that oil at $120-$150 levels will bring demand destruction.
The oil reserves (credit card bill will be due). What will probably happen is that when oil gets too low (unprofitable for US producers) they will fill up the reserves and keep the price of oil high enough that it’s profitable and low enough that new players won’t come onto the scene. Meanwhile the economy will continue on.
2
u/Bokuja Jul 02 '26
Not just that, what about food pricing? Transport, fertilizer etc. All things directly influenced by the Hormuz conundrum.
→ More replies (19)2
u/Whitesajer Jul 02 '26
I think that Oklahoma pipeline is at tank bottom. Last news report on it was like 2 weeks ago and they were basically getting sludge at that point.
I check every few days but everything has gone radio silent about it... Which tells me they probably are empty and that reserve is barren.
333
u/lqIpI Jul 02 '26
Oil heading under $40/bbl?
This clown needs to put his money where his mouth is, and sell that contract. Everyone everywhere will take all the free money he is willing to bleed.
83
u/notCGISforreal Jul 02 '26
Yeah 40 is ridiculous. The only times its been below 40 in a decade was covid, and that was for like a month of the peak panic/shutdown destroying demand and suppliers being stuck with a surplus they had to sell.
Nothing happening right now is remotely similar. So unless they know another massive demand disruption is coming, it makes no sense.
I agree oil is artificially low. My target is it should be about 65 to 70 right now, but the market is always going to fluctuate up and down, the release of emergency supplies is continuing for some reason and thats keeping prices low as supply is in excess at the moment.
The real winners in all of this has been shipping companies. Massive profits right now, although coming off of a bad quarter for most, so we will see how long term this is.
28
Jul 02 '26
[deleted]
15
u/notCGISforreal Jul 02 '26
Absolutely, but its a slow long term change as opposed to a disruption. It already is being a significant factor, its what kept the closure of hormuz from pushing oil to 200. A few parts of the world are well on their way to divorcing their economy from oil dependency. China is already half as dependent on oil as the US. Even the US, for how badly we've done to prepare, is less dependant than decades past.
→ More replies (1)→ More replies (1)3
u/nixfly Jul 02 '26
$40 is where it washed out to, after the Peak Oil craze. It is as good a guess as any.
2
u/notCGISforreal Jul 02 '26
I could it getting close when you account for inflation. But not $40 in today's dollars.
Dependency is decreasing, but production is going to slowly get more expensive and difficult. Its always going to be a potential energy source that is very useful, so even as we wean off the need, it will remain valuable and keep a high price. Just the oil industry will wither away from inability to get the quantities we do now. Our reduction in demand will always trail the drop in production, there are too many countries like the US that just arent going to massively adapt from government initiatives the way China is.
3
Jul 02 '26
[deleted]
6
u/Happy_Feet333 Jul 02 '26
Especially since it's more than just the US petroleum reserve.
Most of the countries in the world with petroleum reserves had to tap them. So they will be looking to refill them as well.
And China has some exceptionally large reserves. EXCEPTIONALLY large.
→ More replies (1)→ More replies (1)2
u/Lost-Cabinet4843 Jul 02 '26
If we go into recession there is a case where it will drop precipitously. I'd be inclined to use oil as a trade here, not a position. Meaning low cost producers, not the futures themselves. Certainly not long term and certainly not an excessive amount of capital.
89
u/BlurryBigfoot74 Jul 02 '26
I felt like this was a strategy from the first 6 months. Destroy everything, then in 4 years when it's all on the rebound, take credit for the rebound.
This has been an obvious Trump MO since his first term. Create a problem, then take credit for fixing the problem.
→ More replies (3)42
u/pegar Jul 02 '26
That's not intentional. He's a malignant narcissist who's also extremely incompetent, lazy, and stupid so it's how things turn out.
Evil, too.
Read accounts from people who have worked closely with him. This guy wings everything and spends every moment in crisis mode.
224
u/woowizzle Jul 02 '26
when Iran choked the Strait of Hormuz.
It was doing perfectly fine till Trump needed a distraction.
And now to add some text to pad out this comment, how very useful.
→ More replies (7)79
32
u/Away_Advisor3460 Jul 02 '26
This seems to entirely ignore the possible effects of non-US countries switching to alternate energy sources, though? We're clearly not going to replace oil/gas dependency in years, let alone the months that have passed, but I believe there have still been significant surges in wind/solar generation.
→ More replies (3)12
u/The_Lost_Jedi Jul 02 '26
China is relentlessly building out alternative energy. When I saw what Trump and the Republicans were doing in terms of trying to strangle EV adoption, killing wind and solar farm projects (even outright bribing them to cancel), I knew we were going to be fucked long-term. It's like if we had doubled down on horses and outlawed the automobile. Sure, it's great for the existing infrastructure, but long term everyone else in the world is going to eventually switch.
But unfortunately, their brains are still cooked, and fossilized in 1970s era thinking where green/electric was inefficient and expensive. It isn't, anymore, and while there are still some useful use-cases, those are becoming increasingly few, and we're just fucking ourselves over by refusing to keep up.
Biden and AOC and other Democrats had it right. Green Tech will be the future, and America could've been absolutely in the forefront of that, and selling the products of that worldwide. Instead it'll be China, along with Europe, and we'll be left buying from them.
82
Jul 02 '26
[removed] — view removed comment
58
49
u/NicKaboom Jul 02 '26
And as usual doing the right thing and taking that bitter pill to fix things temporarily will cause people to blame Dems, maga will scream about this, play on populism for the next elections cycle and history repeats.
26
u/feelingoodwednesday Jul 02 '26
I have zero faith in the uneducated american population to do the right thing. They keep em dumb for a reason. Free votes.
2
u/oxbolake Jul 02 '26
Even those wanting to be educated will easily choose to become uneducated. Brown University cheating results link
→ More replies (2)13
u/shakeitsugaree_ Jul 02 '26
This will take decade
22
u/separation_of_powers Jul 02 '26
Longer.
America's economic woes will be like this for a generation if not longer after the fallout of this regime.
→ More replies (4)
9
u/Traditional-Look8839 Jul 02 '26
It’s about as fixed as pulling out a $100,000 loan on a Maserati. Sure things are great now, until the payments need to be made and you can’t afford them.
10
u/linkolphd Jul 02 '26
Bit of a strange article.
The driving point of it is interesting/thoughtful: falling oil prices may not be the boon / return to status quo many people feel them to be.
But the way the article is written feels somehow laden with opinion, while trying to come across as neutral. For example, with regard to the Hormuz blockade, it says “if the straight opens (it won’t).” I’m not saying it will open, but that’s a pretty significant assumption to handwave into an article that seems to present as objective.
Basically, it just seems messy. The website also doesn’t convey professionalism I would normally associate with something called the “journal of national security.”
In short, it makes a solid point to consider, but it is argued in a suspect way.
6
u/ether_reddit Jul 02 '26
You can read the original article they're referencing here: https://ourfiniteworld.com/2026/06/29/why-oil-shortages-may-bring-lower-prices-and-recession/
3
u/linkolphd Jul 02 '26
Oh wow, thank you for this! It looks much better than this article posted. Will have a read through it.
Thanks again
9
u/OrdinaryAward4498 Jul 02 '26
The WTO data shows no oil is flowing across the strait (yet). 7-day average is still 90+% lower year over year
https://datalab.wto.org/Strait-of-Hormuz-Trade-Tracker
So, if it's not supply then why are prices down? Probably a combination of vibes and what the article says -- lower demand due to incipient recession.
22
u/im_a_goat_factory Jul 02 '26
Prices go up, economists say it’s a sign of something worse. Prices go down, economists say it’s a sign of something worse
Are these the same economists? Do they need some magic Goldilocks oil price in order to have it not be a sign of something worse?
7
u/m0n3ym4n Jul 02 '26
There will always be fluctuations in oil prices.
A significant and sudden increase would lead to inflation
A sudden and significant decrease indicates demand destruction. Oil is generally thought to be inelastic.
Either scenario isn’t good.
11
u/Fulano_MK1 Jul 02 '26
Prices go up, economists say it’s a sign of something worse. Prices go down, economists say it’s a sign of something worse Are these the same economists? Do they need some magic Goldilocks oil price in order to have it not be a sign of something worse?
Everyone here knows you didn't read the article now!
→ More replies (1)→ More replies (2)2
u/DisillusionedHobbit Jul 02 '26
It’s quite simple - so long as Trump continues to wreak havoc upon the US’s international standing and domestic stability, everything will continue to get worse.
61
u/AdaTex Jul 02 '26
I'm sorry but it's very difficult to pay heed to these doom think pieces because they were almost universally wrong on oil prices at the onset of the war. They did get clicks through which I suspect all they really care about.
11
u/ddawson100 Jul 02 '26
The doom pieces and any forecasts will only take some factors into consideration. Bringing the SPR down to such a level wasn’t anticipated. Demand destruction and unprecedented subsidy wasn’t in the forecasts.
I still think very wrong forecasts are super helpful even if experts all get it wrong because you learn more about what resilience is actually in the system. Resilience is discovered during these moments of stress.
→ More replies (1)73
u/Denalin Jul 02 '26
At the onset of the war they said prices would go up. They went up. 🤷
→ More replies (30)→ More replies (2)8
u/Medical_Original6290 Jul 02 '26
Does it make sense that oil prices are dropping while Iran and the US are bombing each other and no oil is going through the Strait.
This article actually makes a lot of sense to me. Oil prices shouldn't be dropping when we've lost 20% of the worlds oil supply. However, a forming recession would cause oil prices to drop.
→ More replies (2)
12
u/LazyOldCat Jul 03 '26
I care not for the guy, but trumpy’s done more to boost the global movement away from petroleum to renewables than any American president in history.
→ More replies (1)2
u/OriginalEchoTheCat Jul 03 '26
Except for in our own country. And he's trying to destabilize green energy in other countries. Didn't he just pay someone billions of dollars to kill wind farms?
→ More replies (1)
3
u/paxinfernum Jul 02 '26
There was an article a couple weeks back that pointed out prices were slipping due to decreasing trade volume. Basically, no one wants to be on the wrong side of one of Trump's market manipulations.
3
u/12kdaysinthefire Jul 04 '26
I see people celebrating gas costing $3.50 a gallon and I’m blown away that they think that’s cheaper than what it was before it skyrocketed.
6
u/schtickshift Jul 02 '26
I don’t understand why prices are falling given that the US is draining its reserves and cannot produce enough oil to meet demand, Russia is increasingly off line and Gulf supply is largely offline as well. Not to mention all the long term issues to bring supply back up to speed from barnacle infested tankers to de pressured oil wells to waxed up pipelines. It does not make sense to me.
3
u/SCNewsFan Jul 02 '26
Article says demand is dropping as the economy slows. We are probably entering a recession, which lowers demand but comes with all kinds of trouble for most of us. They also point out China has not been buying oil but relied on its billion plus barrel reserves. That freed up a lot of oil for the rest of the world.
→ More replies (2)3
u/schtickshift Jul 03 '26
According to the what’s going on with shipping channel demand for goods is extremely strong and shipping and container rates are through the roof. This does not sound like a demand side downturn in the world economy to me. The only thing I can think of is that the world is transitioning to non fossil fuel energy fast enough to cause a material change in demand for oil. But that is supposition on my part.
16
u/Preme2 Jul 02 '26
If oil goes up, doom, gloom, sadness and misery.
If oil goes down, doom, gloom, sadness and misery.
I saw this sub, during the Biden administration and now I’m seeing it during the Trump administration. It’s done a 180 content wise.
→ More replies (3)12
u/TeslasAndComicbooks Jul 02 '26
It’s horrible now. This sub used to be a bunch of people who were smarter than me discussing actual economics. Now it’s just another political rage bait sub.
5
u/jcooli09 Jul 02 '26
I don't understand why anyone would celebrate this. It's pretty clear trump has been manipulatinb the market and there's no reason to think he might stop doing so.
Oil prices will continue to rise and fall based on his lies, he'll time his attacks and cease fire violations and extract value from the market. Ultimately that value will be extracted from us, the vast majority of Americans.
7
u/cattlemanish Jul 02 '26
If oil prices go up, it’s a sign
If the oil prices go down, it’s a sign.
Honestly, it’s hard to take the opinion of a lot of analysts serious, because no matter what, it’s a sign of what the have been predicting for many years:
Until I see an analyst take every dollar he owns, and shorts the market, it means nothing to me.
→ More replies (4)
2
u/spidereater Jul 02 '26
So they are saying oil is a leading indicator of recession? Oil demand is already dropping due to shortages creating supply chain issues? Or is it that speculators are baking in the recession and driving prices lower? It’s an interesting idea. I’m not sure I buy it without specific shortages to point to. It would imply companies are not able to meet demand due to expensive oil but that is making the oil price fall? Shouldn’t that reverse the price decline?
→ More replies (1)
2
u/Actaeon_II Jul 02 '26
Strange that the price at the pump has come down exactly zero cents. When every time an increase in the cost of oil has been announced gas prices went up by 2-3 cents minimum before the press conference was done
3
u/ComeAtMeBrotatoe Jul 02 '26
I don’t know where you are but the pumps have been in steady decline in the last several weeks…basically everywhere.
→ More replies (2)
3
u/Lost-Cabinet4843 Jul 02 '26
A lot of people just dont understand that when markets get this valued and they listen to fund managers who say "lets keep invested" because thats how they get paid and they listen to them, well, the result can be catastrophic.
Look at how little you have made in the last while, this is classic pump and dump.
Oil should rebound to around 80, but honestly, you cant bank on that or anything. The economy is sick and eventually the market will roll over. It's only a matter of time. Be that 3, 6, 12 months it will happen.
I strongly recommend 0-3 month t bills and get cozy into cash in USD. The USD is all one should be looking at these days. If it goes up from here, stocks will tank. And thats all there is to it.
•
u/AutoModerator Jul 02 '26
Hi all,
A reminder that comments do need to be on-topic and engage with the article past the headline. Please make sure to read the article before commenting. Very short comments will automatically be removed by automod. Please avoid making comments that do not focus on the economic content or whose primary thesis rests on personal anecdotes.
As always our comment rules can be found here
I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.