Sanctions on Iran have failed. The weakness of the U.S. position in the oil markets is now complete. Donald Trump’s Energy Dominance strategy has failed.
The announcement by Secretary of State Mike Pompeo (R – The Eschaton) that no more sanctions waivers will be granted to importers of Iranian oil. Those that do so will face sanctions.
But let’s look at what is actually on the table. Waivers will be extended to a year from now during a ‘wind-down’ period. But, I thought these past six months were the ‘wind down’ period Don?
I told you these would get extended the minute they were granted. Because three of these countries — India, Turkey and China — are in open revolt over the policy.
And they have built plenty of infrastructure to get around these sanctions when or if they are ever implemented.
Three of the eight countries granted waivers — Italy, Greece and Taiwan — do not need waiver extensions as they’ve already cut their imports to zero.
But the main issue here is the extension. It’s clear that Trump and his merry band of neocon handlers are afraid of further disruption of the oil supply and demand, otherwise the extensions wouldn’t have been granted at all.
They talk tough about UAE and Saudi Arabia adding supply but the reality is it isn’t that easy to spin up new supply. And the year-long waiver extension is proof of this. They’ll certainly sell all they can but there are those pesky OPEC quotas to deal with.
No one was willing to go along with the Saudis OPEC+ plan where they and Russia would be pigs more equal than the others this winter, so it’s unlikely that will happen now that Trump has helped them push prices back towards $75 per barrel.
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