Phil Flynn is writer of The Energy Report, a daily market commentary discussing oil, the Middle East, American government, economics, and their effects on the world's energies markets, as well as other commodity markets. Contact Mr. Flynn at (888) 264-5665
Oil prices are coming back as traders get back at it and get serious after a seasonal and fear-based drop in prices. Demand fears were high as refiners are in maintenance and a spike in covid cases globally seemed to weigh on market sentiment. The Saudi oil price cut also played into demand fears. The Saudis seemed to suggest that the market had it all wrong about the price cut, and as indicated by Reuters, they fully expect that OPEC laggards will increase their current production levels to make up for past cheating. We also had the sharp correction in stocks, which by any measure, should be healthy, and we are already seeing some buying come back in as more traders find their way to the computer after their Labor Day holiday vacation.
On the geopolitical front, Iran announced that they would be conducting war games in the Strait of Hormuz, but the biggest shock may be that President Trump was nominated for the Pulitzer Peace Prize. Well, at least a surprise to the Trump haters who cannot find their way to give the president any credit for anything. Fox News, in an exclusive, reported that, “Just weeks after helping to broker peace between Israel and the United Arab Emirates (UAE), President Trump has been nominated for the 2021 Nobel Peace Prize. The nomination was submitted by Christian Tybring-Gjedde, a member of the Norwegian Parliament, lauded Trump for his efforts toward resolving protracted conflicts worldwide. “For his merit, I think he has done more trying to create peace between nations than most other Peace Prize nominees,” Tybring-Gjedde, a four-term member of Parliament who also serves as chairman of the Norwegian delegation to the NATO Parliamentary Assembly, told Fox News in an exclusive interview. Tybring-Gjedde, in his nomination letter to the Nobel Committee, said the Trump administration had played a vital role in the establishment of relations between Israel and the UAE. “As it is expected other Middle Eastern countries will follow in the footsteps of the UAE, this agreement could be a game-changer that will turn the Middle East into a region of cooperation and prosperity,” he wrote.
The deal makes Iran more isolated and according to President Trump, other Israel foes will soon join the peace movement. As Iran becomes more isolated, it has announced war games. The Jerusalem Post reported, “Iran is preparing a new exercise that will involve the navy, army, and air force. It will take place over a massive area of “millions” of square kilometers and will include the Strait of Hormuz, the shores of Makran, the Gulf of Oman, and the Indian Ocean, Iran says. This new drill comes on the heels of increased military activity in Iran designed to show the US and the Gulf states that the Islamic Republic has improved its precision weapons and drones.
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