Middle Eastern turmoil and gas and oil prices
A note on Middle Eastern turmoil and gas and oil prices
– by New Deal democrat
While we wait for producer and consumer inflation data later this week, here’s a note about gas prices.
With the newest shock in the Middle East, conventional wisdom is that the price of oil and gas will spike. And maybe they will, but the truth is, because of the involvement of both market and geopolitical players, nobody really knows.
Remember that Russia’s invasion of Ukraine in February last year caused gas prices to rise from $3 to $5 a gallon by June. And then they went right back down to $3 by last December.
Here’s a graph of oil prices for the past year, with this morning’s current price as I write this called out at the far right:
Gas prices ended last Friday at roughly $82.82 a barrel, and have risen over $3 a barrel so far this morning. But a week before prices were over $90 a barrel. So we haven’t even challenged that level yet.
Maybe oil prices will go over $100 a barrel because of this latest turmoil, if the petrosheikhdoms of the Middle East decide they have to put pressure on the West to in turn put pressure on Israel. Or maybe they will sit on their hands, and maybe oil slides back towards $70 a barrel.
The point is, nobody really has a clue. And even if prices move sharply in one direction in the next month or two, they may move right back shortly thereafter.
Gasoline Pricing during my lifetime – Angry Bear
Commemorating the 1973 Arab-Israeli War maybe?
Wikipedia: The Yom Kippur War, also known as the Ramadan War, the October War, the 1973 Arab–Israeli War,
(It seems Iran was surprised by the Hamas attacks. So the rest of the Middle East would have been also, presumably. OPEC would just be cutting supplies and raising prices accordingly for the traditional reasons.)
Early Intelligence Shows Iranian Leaders Surprised by Hamas Attack, US Says
NY Times – just in
Is the 1.3- to 1.5 quadrillion dollar equivalent asset-debt global macroeconomy affected (in an appreciable way) by a parochial conflict?
The near term price of oil (and its collapse within the next 12 trading days) has much more to do with the ongoing 60 trillion dollar-equivalent Chinese property collapse and Chinese private citizen wealth destruction than the (really terrible and awful) 1 against 12 tribe conflict in the mideast.
The near term price of oil (and its collapse within the next 12 trading days) has much more to do with the ongoing 60 trillion dollar-equivalent Chinese property collapse and Chinese private citizen wealth destruction…
[ This is absurd. China is just fine; really better than fine and will grow comfortably over 5% this year. ]
…60 trillion dollar-equivalent Chinese property collapse and Chinese private citizen wealth destruction…
What is the point of such absurdity? ]
China’s Economic Stake in the Middle East: Its Thirst for Oil
NY Times – just in
EIA reported yesterday that: USA crude output/ supply is up a bit, crude net import is down a bit, and net export of finish product is up quite a lot.
EIA inventory of gasoline distillate and kerosene is plus year on year but a bit down on long term seasonal avg. For current seasonal.
Note on crude: USA net importer from Canada and Mexico. Export some to EU and Asia.
Hope this dust up does not affect Persian Gulf flow which goes a large part to Asia.
In most cases hope is not strategy