US President Donald Trump on Wednesday tried to project optimism about reaching a deal to end the illegal war he started against Iran, even while acknowledging the crisis could last for several more months.
In an interview with The New York Post, Trump was asked whether the current blockade of Iran would last until Labor Day, which falls on September 7 this year.
“I don’t know,” Trump said. “I mean, I think it could be, but I think it’s unlikely.” He added, “I think this will resolve itself fairly quickly.”
The president for the last several months has managed to keep oil prices from spiking to disastrous levels by dropping hints that his illegal war will soon be over, even though it has continued with no end in sight.
And while the Trump administration has insisted that its ceasefire deal is still in effect, CNN reported on Wednesday that Iran launched attacks against US military bases in Kuwait and Bahrain after US forces fired a Hellfire missile at a Botswana-flagged oil tanker that was heading toward an Iranian port.
Iran also launched drone and missile strikes at Kuwait’s international airport, killing one person and leaving dozens injured, according to Al Jazeera.
Oil industry expert Patrick De Haan on Tuesday warned that the price of oil will soon shoot back up if the Strait of Hormuz remains closed because US petroleum supplies, which have been drained at a rapid pace since the start of the war, are about to hit their lowest level in over two decades.
“US distillate inventories will likely fall under 100 million barrels for the first time in over 20 years, exacerbated by high exports due to the closure of the Strait of Hormuz,” De Hann wrote in a social media post. “This is a powder keg waiting to go off if a deal to reopen the strait doesn’t happen soon.”
In an analysis published Wednesday, The American Prospect’s Ryan Cooper similarly warned that the tricks used by nations around the world to keep a lid on oil prices, such as releasing petroleum reserves, would soon be ineffective thanks to hard supply constraints.
“As storages dwindle and run out, the only way to match demand to supply will be for the price to rise high enough to destroy something like 10 to 20% of global oil consumption,” Cooper wrote. “And because a great deal of oil demand is obligatory and therefore not very price-sensitive, that price will likely be north of $150 per barrel.”
This would lead to not just an explosion in gasoline and diesel fuel prices, Cooper continued, but a “corresponding price hike for anything that needs to be transported, or involved in plastic in some way, which is to say basically everything.”
Sometimes the old senior says he does not care. Sometimes he posts dozens of tweets , late at night.
That flushes India down the toilet. No fuel, no fertilizer, no power, and plenty of Summer heat.
Oil prices are weak considering all the problems and low inventory of oil storage. Oil traders are hoping for Taco. By the end of the month, oil tanks will be the lowest in history then, oil has no choice but go to $150.
There is a food shortage coming. Persian Gulf nitrogenous fertiliser is about one third of the international trade. The impact of the blockade, however, is reduced by many countries making their own, United States and China are big producers, thus reducing the global impact to 9%. But it is not simple a case of crops down by 9% because agriculture works to a strict calendar. Reduced urea application in the spring planting window can dramatically lower yields. It won’t impact the US, China or Russia much, but countries reliant on imports, India, say, will likely suffer food shortages in 2027. The West won’t get off scot-free either, the price of animal feedstuffs will rise, leading to sharp rises in the price of meat, dairy and eggs.