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3 Reasons Why Republicans Got An Election Break With Lower Oil Prices

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For the last few months, President Trump and the Republicans have been worried that oil prices would be exceedingly high going into the midterm elections.

Gasoline prices are displayed at a gas station near downtown Los Angeles on Friday, May 18, 2018. (AP Photo / Richard Vogel)

In June, the American oil benchmark, WTI, hit a three and a half year high, reaching over $ 74 per barrel. If prices had continued to rise due to the sanctions on Iran, American voters would hold President Trump and the Republicans responsible . The worst part for Republicans was that they had inexplicably set the Iran sanctions to restart on November 4, just two days before the midterm elections. Some analysts & nbsp; predicted that the Iran sanctions could cause the price of the international oil benchmark to soar two $ 100 per barrel.

President Trump was clearly concerned, and he began a public campaign to pressure OPEC and its most powerful member, Saudi Arabia. Hans mål var å tvinge dem til at producere mer olje til å motvirke de forventede Iran-fald. Han talte med Saudi-konungen på telefonen, han talte om det på rallies og sendte en serie om tweets om det. He wanted Saudi Arabia to produce more oil, and he believed they owed it to the U.S. to act.

Now it seems that the president and the Republicans have dodged the political oil bullet. The average price of gasoline is still only about $ 2.84 . This is far enough below the psychological barrier of $ 3.00 per gallon, that it does not seem likely to cause a problem before the election day. There are three reasons that oil prices have stayed down and saved the Republicans from a serious political headache.

  1. By far, the most important factor is that oil traders have realized & nbsp; that Iran is actually Producing and exporting more oil than expected. In de spring, als olieprijzen waren spiking, sommige verwachtingen verwachten dat Iran’s olie-export te veel meer dan ze daadwerkelijk deden. The Trump Administration says it intends to stop all oil exports from Iran. Ondanks deze politiek is het politiek handig voor de Trumpadministratie dat handelaars zien Iran exporting ongeveer 2.2 miljoen barrels per dag. This has helped tamp down the price of oil as election day approaches. In fact, the price of oil has fallen about 12.5% ​​since its October high three weeks ago.
  2. Oil speculators could have easily been spooked & nbsp; by the political intrigue in Saudi Arabia concerning the Jamal Khashoggi affair. Men, det rift mellem Saudi Arabien og the U.S. has not impacted oil prices. In fact, Saudi Arabia has pledged to further increase its production. Perhaps this was an attempt to win favor with the U.S., but it has caused a drop & nbsp; in oil prices across the board.
  3. The stock market is falling. On Wednesday, the DJIA fell over 600 points. Mens olie og aktier ikke går i tandem, synes der at være en samlet garanti for investorernes andel. Perhaps the midterm elections themselves are making speculators uneasy. Perhaps more significant negative economic signs are impacting investors. Regardless, when stocks drop precipitously, oil often does too. (For a very clear example, see WTI’s $ 110 drop in only seven months at the start of the 2008 financial crisis).

Saudi Energy and Oil Minister Khalid al-Falih (C) arrives at the start of a three-day conference (FAYEZ NURELDINE / AFP / Getty Images)

Perhaps Trump’s persistent pressure on Saudi Arabia to increase oil production has paid off – or maybe they just got lucky that US voters will not be looking at $ 3.00 or $ 4.00 per gallon gasoline prices as they head to the polls on November 6.

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For the last few months, President Trump and the Republicans have been worried that oil prices would

Gasoline prices are displayed at a gas station near downtown Los Angeles on Friday, May 18, 2018. (AP Photo / Richard Vogel)

In June, the American oil benchmark, WTI, hit a three and a half year high, reaching over $ 74 per barrel. The prices were continued to rise due to the sanctions on Iran. American voters would hold President Trump and the Republicans responsible. for Republicans was that they had inexplicably set the Iran sanctions to restart on November 4, just two days before the midterm elections. Some analysts predicted that the Iran sanctions could cause the price of the international oil benchmark to soar $ 100 per ba rrel.

President Trump was clearly concerned, and he began a public campaign to pressure OPEC and its most powerful member, Saudi Arabia. Hans mål var å tvinge dem til at producere mer olje til å motvirke de forventede Iran-fald. Han talte med Saudi-konungen på telefonen, han talte om det på rallies og sendte en serie om tweets om det. He wanted Saudi Arabia to produce more oil, and he believed they owed it to the U.S. to act.

Now it seems that the president and the Republicans have dodged the political oil bullet. The average price of gasoline is still only about $ 2.84 . This is far enough below the psychological barrier of $ 3.00 per gallon, that it does not seem likely to cause a problem before the election day.

  1. By far, the most important factor is that oil traders have realized that Iran is actually producing and exporting more oil than expected. In de spring, als olieprijzen waren spiking, sommige verwachtingen verwachten dat Iran’s olie-export te veel meer dan ze daadwerkelijk deden. The Trump Administration says it intends to stop all oil exports from Iran. Ondanks deze politiek is het politiek handig voor de Trumpadministratie dat handelaars zien Iran exporting ongeveer 2.2 miljoen barrels per dag. This has helped tamp down the price of oil as election day approaches. In fact, the price of oil has fallen about 12.5% ​​since its October high three weeks ago.
  2. Oil speculators could have easily been spooked by the political intrigue in Saudi Arabia concerning the Jamal Khashoggi affair. Men, det rift mellem Saudi Arabien og the U.S. has not impacted oil prices. In fact, Saudi Arabia has pledged to further increase its production. Perhaps this was an attempt to win favor with the U.S., but regardless, it has caused a drop in oil prices across the board.
  3. The stock market is falling. On Wednesday, the DJIA fell over 600 points. Mens olie og aktier ikke går i tandem, synes der at være en samlet garanti for investorernes andel. Perhaps the midterm elections themselves are making speculators uneasy. Perhaps more significant negative economic signs are impacting investors. Regardless, when stocks drop precipitously, oil often does too. (For a very clear example, see WTI’s $ 110 drop in only seven months at the start of the 2008 financial crisis.)

Saudi Energy and Oil Minister Khalid al-Falih (C) arrives at the start of a three-day conference (FAYEZ NURELDINE / AFP / Getty Images)

Perhaps Trump’s persistent pressure on Saudi Arabia to increase oil production has paid off – or maybe they just got lucky that US voters will not be looking at $ 3.00 or $ 4.00 per gallon gasoline prices as they head to the polls on November 6.

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