Macro Voices MacroVoices #465 Rory Johnston: Oil Markets Under Trump 2.0
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Jan 30, 2025 Rory Johnston, the founder of Commodity Context and an energy market expert, dives deep into the intricacies of the crude oil market. He discusses the significant impacts of Trump’s tariff policies on oil supply and the critical importance of crude quality in refining. Johnston highlights the geopolitical implications of U.S. foreign policy on oil prices, touches on OPEC's production strategies, and explains how sanctions on countries like Iran and Venezuela shape the market. It's an insightful exploration of oil's evolving landscape!
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Bullish Oil Market
- The oil market is currently undersupplied, with demand outpacing supply.
- This bullish trend, indicated by a backwardated futures curve, points to gradually higher prices.
Trump's Impact on Oil
- President Trump's influence on oil prices might come from sanctions rather than increased US production.
- US production growth is slowing, and regulatory changes won't drastically change this trajectory.
Limits of Government Influence
- The US government can incentivize domestic drilling but not force increased production.
- Private companies prioritize their interests, aiming for market tightening, not oversupply.