What I don’t get is why prices aren’t already rising more than they have. It seems like literally everyone except the Trump administration itself expects the strait of Hormuz to remain blocked for a long time, so shouldn’t that be priced in already?
Normally you would see the massive shortfall where ~15% of global oil demand needs to be destroyed by price increases, and you would then assign the risk that happens, and take the integral over your risk distribution times your pricing scenarios.
However, two things are going wrong:
- markets wildly overestimate Trump’s words and ability to resolve this, so are mis estimated risk
- oil execs are happy with the extra income
So they’ve put off the price increases entirely because of hubris.
A competent administration would have filled the reserves to capacity (75MM barrels) before starting shit with Iran. I am going to take a wild huess that they did not do that.
I mean they did nab Venezuela’s oil right before all of this. They may be using the Iran war to throw a wrench into global supply and thus make Venezuelan oil more attractive. The geopolitical value of Venezuela’s oil undoubtedly spiked at the onset of the war.
That’s 4D chess, so I doubt it. More likely is that they assumed that the Iranian regime was at a tipping point (it was), and figured theyncould swoop in, bring “freedoms” and take all the oil from an American/Saudi/UAE/Israel puppet government. Instead, all they did was solidify the existing regime and multiply their influence by an ordernof magnitude, while significantly decreasing the US standing and influence in geopolitics.
It’s pretty clear that at no point did the US plan for Iran closing the state. They should have. Every previous US government considered it the primary danger of a war with Iran. But Trump doesn’t surround himself with smart people.
Also there’s credible reporting that their belief that Iran would not close the strait was reinforced by the AI planning systems they recently invested in. So that’s fun. The blind leading the stupid.
And or just not stuck their dicks in the bear trap that is Iran.
Seriously.
Live not far from that town.
I used to live near there as well.
I bet there are at least dozens of us on Lemmy.
