As Oil Prices Rise, Stocks Plunge, Trump Promises Low Oil Prices After Midterm Election

Signaling no impending end to the conflict with Iran, President Trump pledged Wednesday $2 per gallon gas after November’s midterm election, a prediction that kept the international benchmark for oil over $101 per barrel and sent U.S. stocks plummeting for the third day in a row.Speaking to reporters on the tarmac at Joint Base Andrews before heading to Dallas, where he is attending an unprecedented two-day midterm Republican convention, the president said Iran’s leadership is not willing to capitulate because it wants Democrats to get elected in the November 3 vote.“They’re desperate to try and affect the election, so that we can get a nice weak group of people in there and leave them alone and let them have their nuclear weapon,” Mr. Trump said, rejecting the idea of going back to the negotiating table with the regime.“Shortly, right after the election, gas prices are going to come tumbling down. … This war will end immediately after our election,” he said, without explaining how tactics may change after the vote.Mr. Trump will be joining up to 20,000 conventiongoers in the American Airlines Center, situated amid some of the lowest gas prices in the country. Gas prices at the local Costco sit below the state average of $3.76. But that discount rate at Dallas is cold comfort for conventioneers and other voters in toss-up states where prices are already over $4 per gallon and are cresting $5 a gallon in some spots. Elevated prices could dash already dimmed hopes of Republicans looking to dodge a midterm blue wave. The benchmark for West Texas oil closed Wednesday at $96.30 per barrel while Brent Crude ended the day just over $101.Mr. Trump has withdrawn more than half of the U.S. Strategic Petroleum Reserve over the course of his term in an effort to combat price increases spurred by the conflict between Russia and Ukraine and U.S. intervention in Venezuela and Iran. He promised that Venezuelan oil would soon come to the rescue, refilling the reserve; however, the heavy oil produced there is not suitable for long-term storage in America’s salt caverns. “Oil is over $95 per barrel, despite the fact that the Trump administration has been rapidly draining the SPR to keep oil prices suppressed prior to the midterms,” Chief Economist and Global Strategist of Euro Pacific Asset Management, Peter Schiff, a staunch critic of the president, wrote on X. “Imagine how much higher oil prices will be by the general election in 2028, if the SPR has been empty for over a year.”Republicans had hoped that a Democratic Party’s financial struggles and internal bickering over how far left it should lurch would bolster the GOP’s chances to stave off midterm losses, a scenario common for presidents holding a congressional majority at the midterm. The president had planned the midterm convention in September to drive momentum before Election Day. But now the party has found itself trying to find its footing even in some traditionally red states as low-level war percolates in the Strait of Hormuz, driving down global oil supplies, and consumer prices battle to keep pace with inflation, hovering around 3.3 percent higher than a year ago.“What a disaster. Don’t expect your gas prices to come down anytime soon,” Congressman James Clyburn wrote on X after the president’s remarks. “Trump is worried that high gas prices could sink Republicans in the midterms. He believes escalating the war would drive prices even higher—despite repeatedly claiming that Iran has been ‘decimated’—and appears to be planning further escalation after the election,” the South Carolina Democrat added.Senator Rick Scott, acknowledging the higher costs, told convention-goers on Wednesday that the conflict with Iran is more than about gas prices. “Nobody likes higher gas prices, but nobody wants to be killed by a nuclear weapon. That’s what’s at stake here. Do we want to be destroyed by a nuclear weapon?” he said. With oil prices driving interest rates up on 10-year U.S. Treasury notes, Republicans are bracing for potentially more bad news next week when the Federal Reserve has its next rate-setting meeting. A positive employment report last week was good news for the economy but puts pressure on the Fed to raise rates. While the new chairman, Kevin Warsh, has kept close to the vest how closely he wants to link employment to interest rates, some analysts predict the Federal Reserve will increase the cost of borrowing, impacting credit cards as well as auto and home loans. “A prolonged oil shock could keep price pressures elevated and complicate the path for central banks that are already navigating a difficult policy environment,” head of market research at FXTM, Lukman Otunuga, told MarketWatch.

As Oil Prices Rise, Stocks Plunge, Trump Promises Low Oil Prices After Midterm Election

As Oil Prices Rise, Stocks Plunge, Trump Promises Low Oil Prices After Midterm Election

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