This IS attached to the Trump War against Iran… in different ways…
It IS something American voters will see graphically in the wallets….
(The Trump War is also effected other countries around the world…)
It IS NOT something that will make them feel good about the current economy , which for better or worse?
Belong’s to one President Donald Trump, and accordingly, member’s of ‘HIS’ Republican Party…
We repeat?
There IS a Midterm Election vote coming in about Eight Months ….
Hmmmmmm?
This is going to be one of the shorter newsletters in recent Silver Bulletin history. My main mission for the next week is to finalize our NCAA tournament forecasts.1 But as you might have noticed, there’s a lot going on in the world. And there’s a story that seems very likely to become a major part of the political conversation while the tournament is underway.
As the headline suggests, it’s gas prices. Although the United States is less reliant on foreign oil than it once was, the war in Iran could be a perfect storm for gas and energy prices in the U.S. and elsewhere to spike.
Iranian production of oil is severely disrupted, of course, with the U.S. and Israel attacking the country’s fuel infrastructure. But Iran itself isn’t that large a supplier of oil. Estimates vary from source to source, but it was something like the 6th to 8th largest producer in 2024, extracting 4 to 5 percent of the world’s oil….
…
According to the AAA, average retail gas prices in the U.S. are now $3.45 per gallon, up about 50 cents from a week ago. However, the problems are likely to worsen significantly as supply chains are disrupted. Traders at Polymarket anticipate that the most likely range for gas prices to land by the end of March is between $4.50 and $5.00. And although there’s a wide range of uncertainty, there’s a 41 percent chance they exceed $5.00 by the end of the month. The all-time record, according to the EIA, was $5.01 in June, 2022….
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So far, as Eli wrote at our Trump tracking page, there hasn’t been much of a shift in the president’s approval ratings. The war is broadly unpopular in polls, but Trump was unpopular to begin with. Unlike something like Venezuela, however, this isn’t some sort of surgical strike. It’s not at all clear what the U.S. and Israel even want to achieve.
Trump’s nonchalance about all of this won’t help him either. He literally campaigned on lower gas prices in 2024, and inflation was a substantial factor in his defeat of Biden. The sharp rise in gas prices in late spring and early summer 2022 was associated with a noticeable decline in Biden’s approval ratings from the 40s into the high 30s. It all would seem to follow a classic script of how second terms can turn into lame duck presidencies…..
….
The Gas/Oil issue isn’t just a problem for America….
The cost of shipping goods by air from Asia to Europe is up 45 percent since the war began, more than twice the increase for sending items from Asia to the United States, said Ryan Petersen, chief executive of Flexport, a freight forwarder and logistics company in San Francisco.
The shipping impact illustrates a broader economic truth: The war is hitting the economies of Europe and Asia harder and faster than it is striking the United States.
“Europe and Asia are heavily dependent on energy imports, so that alone makes them more vulnerable to negative macroeconomic spillovers from the Iran war,” said Maurice Obstfeld, former chief economist for the International Monetary Fund. “Being closer geographically to the hostilities also makes Europe and Asia more vulnerable to shock waves from the war.”
That does not mean Americans will escape unscathed. Gasoline prices now average $3.41 a gallon, up from $2.98 one week ago, according to AAA. Farmers face higher bills for critical crop nutrients, and additional supply chain headaches are certain if the Iran conflict continues longer than the Trump administration anticipates.
But for now, economies such as Italy, Belgium, China, India and South Korea, which are the most dependent on oil and gas shipments through the Strait of Hormuz, are feeling some of the worst effects….
Note….
Around my way Gas prices have risen by .60 cents a gallon…
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