By supporting Saudi Arabia and its allies in their confrontation with Iran— preparing the groundwork for an all-out confrontation between the regional powerhouses — Donald Trump may help foster a major disruption in Middle East oil supplies and drop the price of crude oil. This is, according to Forbes, a dream scenario for American frackers who will be able to pump oil quickly to supply America’s allies amid any potential Middle East oil crisis.
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Iran has already signaled its intention to close the Strait of Hormuz should the U.S. or one of its client states, such as Saudi Arabia or Israel, decide to wage a war against the Islamic Republic. Iran even has plans to mine the waterway, and just last month Iran and China held joint naval drills in this vitally strategic body of water.
According to the U.S. Energy Information Administration (EIA), 17 million barrels of oil pass through this strait per day, representing 30% of all maritime-traded petroleum. The closure or disruption of this strait alone will directly impact on the world’s oil markets.
As Forbes notes, there are signs that Saudi Arabia and Iran are edging closer to a direct confrontation (they have already been heavily engaged in proxy wars in the region against each other as it is). Saudi Arabia’s promotion of anti-Iranian war-hawk Prince Salman, the King’s son, to Crown Prince is but one of the indicators that Iran and Saudi Arabia may soon be fighting out their disputes militarily.
“The biggest gainers will be the US frackers,” says Athens-based shipping expert Theo Matsopoulos, as reported by Forbes. He continued:
“With an extremely wide break-even range from $32 to $55 per barrel, an increase in the oil price to levels higher than $50 will make the overwhelming majority of them smile. The US will soon be able to finance its trading deficit and solidify even more its position as a major oil exporter. The longer a potential crisis in the Middle East lasts, the more the market share of the US companies will increase — because apart from prices and commodities the political stability of the USA can act as a guarantee for a smooth supply of oil for many consumers.”
According to Forbes, this is why Washington may “do little if anything to stop a direct war between the two old adversaries.”
Forbes also suggested that if Russia were to buy into this scenario, their own oil producers would benefit. However, the U.S.’ aim in controlling the oil market and reaping all the rewards would surely not allow a place for Russia to join in this venture, so it seems likely that Russia would ultimately be an indirect target of this potential strategy, as well.
Because of the high stakes involved in such a conflict, a war between Saudi Arabia and Iran may not be on the horizon anytime soon. However, in the event that this inevitable clash does break out into something tangible, remember that Donald Trump has had American financial interests at heart the whole time — as he promised in his campaign.
That’s all that matters, right? Money, wealth, and natural resources.
Let’s just put out of our head the millions upon millions of people who die in American-led wars across the Middle East. As long as someone can make a fast buck out of the chaos, Trump and his followers can sleep soundly at night.