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Oil at $150 will trigger global recession, says boss of financial BlackRock
- r0fl 7mo agoIt’ll trigger a lot of political pressure which in turn will trigger more war Expensive oil has a lot of repercussions
- deleted 7mo ago[deleted]
- hedora 7mo agoEither that, or it will force most countries to electrify their economies, which has made economic + ecological sense for decades. The oil interests will do everything they can to fight it. (Like buying off Trump, which probably had a lot to do with us starting the Iran war, and is certainly why we're cancelling many affordable energy build outs in the face of widespread shortages.) Less corrupt economies will pull ahead, and technological progress will bifurcate. The US will probably be on the wrong side of this. China will probably be on the right side.
- adi_kurian 7mo agoHow quickly could we electrify our economies and what dent in oil dependence could be made with a will?
- adrianN 7mo agoI doubt people here can give realistic estimates as to how quickly we can ramp up the production of e.g. heat pumps, since a lot depends on how much we're willing to pay for it. There are many areas where we have the technology to electrify, we just don't do it because at current fuel prices pay back times for electrification are too long. There are also simple things like better insulation for buildings that can dramatically reduce fuel demands.
- fy20 7mo agoThe US produces much more natural gas than it consumes, so changes like this don't really make sense. Europe started implementing these initiatives a couple of decades ago, it makes sense there as they are a net importer, with residential prices around 3x higher than the US. In my country a newly built house (very low energy demand) is often cheaper to heat with a heat pump than natural gas, especially if combined with solar PV - but that's still more expensive than a home in the US. The most impactful usages are transportation, as everywhere basically everything is transported by road, and renewable electricity generation, so fossil fuels can be used elsewhere (residential, industrial, etc).
- eucyclos 7mo agoEurope, particularly Germany, has quite a will. Maybe a little faster than that given there are lessons to be gleaned from it.
- samaltmanfried 7mo ago> Like buying off Trump, which probably had a lot to do with us starting the Iran war... Oil companies have actually not benefited from America's middle-eastern wars. America's regime-change wars have made the region less profitable for US oil companies. Why invest in infrastructure in countries with unstable regimes, or risk of infrastructure becoming a target? If anything, energy companies would benefit from the sanctions on Iran being lifted, so they could invest in infrastructure there, or buy gas from Iran. I hope one day this silly 'war for oil' meme will disappear.
- BLKNSLVR 7mo agocough Russia cough
- rayiner 7mo ago> Like buying off Trump That’s a weird thing to say considering that the Iran hostage crisis helped swing an election almost half a century ago. It’s not like nobody thought about going to Iran until someone bribed Trump to do it. The far more rational theory is that Trump did it to deflect from his failure to combat inflation domestically. They made an entire movie about his. (Wag the Dog.)
- jmyeet 7mo agoThis war of choice is going to redefine the US's policy and relationships with Middle East, China, Russia and Europe for the rest of the century. Even if it ends tomorrow. Mainly because the only way it ends tomorrow is if sanctions on Iran are lifted. And they should be lifted anyway so I'd be a fan of that. China, Iran and Russia look to the the big winners here. Everyone else is a loser, the US the biggest loser of them all. In history books I think this will go down as the biggest geopolitical miscalculation and mistake in US history of anything to date and it's not even close. The Middle East consists of a bunch of US client states where arms are used to maintain fealty. The US gives arms to a despotic regime who enrich themselves off of their country's natural resources and they use those arms to stay in power. This last month has shown the US security guarantee to the Gulf to be a paper tiger. This is a seismic potential rift between the US and Israel. This war of choice has undermined relationship with long-term allies (eg in Europe) who were never consulted and never approved of this war and may suffer with significantly higher electricity prices as a result. This is a Napoleon invading Russia level of blunder.
- vasco 7mo agoNot sure how iran is winning while getting destroyed. It'll be another refugee crisis
- esseph 7mo agoWinning for Iran, their whole strategy, is that their pressure on the straight hurts the US and world economy to a devastating level. What the US is gearing up for right now is a multiyear war where the US military goes into the island tunnels and tries to hold the Straight open by force.
- rayiner 7mo ago> biggest geopolitical miscalculation and mistake in US history of anything to date and it's not even close Bigger than Iraq?
- jmyeet 7mo ago
- bryanlarsen 7mo agoMany people believe the root cause of the Arab Spring set of insurrections and wars was food inflation. And it's now a lot more expensive then what kicked off the Arab Spring.
- ethbr1 7mo agoThe difference with oil inflation is that it also directly boosts revenues in oil-producing Middle Eastern countries. Consequently, they can offset core staple inflation (and usually choose to) to decrease unrest. It's core inflation without high oil prices that torpedoes their fiscal options.
- bryanlarsen 7mo agoPerhaps it makes it less likely in the middle East, but it makes it much more likely in countries vulnerable to both oil & food price inflation. The immigration crisis caused by Arab spring toppled many governments in Europe. If a similar set of crises happened in the Americas it would make the US's illegal immigration situation much worse.
- red-iron-pine 7mo ago> The immigration crisis caused by Arab spring toppled many governments in Europe. that was entirely of their own making, though
- decimalenough 7mo agoMisleading headline: Fink said that "years of above $100, closer to $150 oil" would trigger recession. Which, well, duh, but it's quite different from the implication that even a momentary peak would trigger that. I also do wonder if oil prices would actually stay high even if the Strait of Hormuz stayed closed for years. Many analysts think that as a planet we're already past peak oil demand, and the price spike has turbocharged the transition to EVs (where I live, every EV dealer is flat out and waiting times are months). High prices also spur more production from everybody else. The tricky bit is specialist fuels like jet fuel, where you can't just turn a tap to make more.
- BLKNSLVR 7mo agoWas looking at EVs last weekend, slightly accelerating a purchase that was going to be made soon anyway and, yep, there is plenty of additional interest as a result of current fuel prices / availability. EVs were only going to grow in popularity anyway, but this feels like it's jumped the adoption curve up a peg or two immediately. What I'm interested in seeing is whether infrastructure can scale with the additional interest. And I don't think it will because the the current government is already planning to add an "EV tax" to make up for the fuel excise, and the opposition government (if/when it gets back in) is owned by the fossil fuel lobby, and so they'll be doing whatever they can to slow it down.
- eucyclos 7mo agoInfrastructure for ev charging is a lot easier to add than gas stations though.
- whatever1 7mo agoThousands and thousands of miles of high voltage cables transformers and super expensive chargers sounds easy to you? A gas station just needs a tank and a pump. You can put it anywhere and can operate with a small generator if 110V electricity is not available. Even as a country you don’t need infra. Just some trucks to import from the closest refinery/ port
- diogenescynic 7mo agoIt'll force American to negotiate with Iran and China/India will be the mediators. It will be the beginning of the end of the Petrodollar and likely force America to leave the Middle East. It will empower Russia, China, and India while hurting US interests. I don't know why we started this war at all other than to serve Israel's interests even when it means harming our own.
- platevoltage 7mo agoThe ambassador to Israel is a Christian Zionist who believes in the rapture. The secretary of defense is a crazy person with a crusades tattoo. They would burn the USA down to the ground if it meant moving their insane superstitious agenda forward. Is it forwarding Israel's interests? Yeah. Are they doing it because they love Israel and the Jewish people? Not a chance. Isn't the Rapture cool?
- smt88 7mo agoI suspect Hegseth and other officials will be replaced when Trump internalizes how unpopular this war is and needs a scapegoat to facilitate a pivot. He's already blaming other people in his administration for anything that's going wrong. Even if his officials are ideologically stable and consistent, he himself isn't.
- diogenescynic 7mo agoI don't think he cares? He's going to cash out after this and his donors will make sure he is paid handsomely for this. He can't run again and Israel just took 10% of Lebanon and is poised to be the great regional power. They're already talking about Turkey and Pakistan as the new threats... They will just keep moving the goalposts until it stops working. I have no clue where this ends, but Iran could end up buying a nuclear weapon from Pakistan if this keeps heating up.
- platevoltage 7mo agoThat is kind of his style. And then we have "anti-war" voices like future president Tucker Carlson who refuses to say Trump's name when criticizing US foreign policy. It just gives him room to say "it wasn't my fault, aren't I great?"
- xvxvx 7mo agoHe lost me at the part where he said AI wasn’t a bubble…
- BLKNSLVR 7mo agoOther than the overblown headline, Fink has a strong interest (as in 100%) in not causing market panic. The statement about oil prices is probably a public statement to Trump to "get this situation resolved ASAFP, I've told you what will happen!".
- mrcwinn 7mo agoFortunately, this won't happen. Trump is a populist. The war will end simply because the repercussions are far too great. And even though Israel would like to see the deaths of others continue indefinitely, they are still too small and too weak and too dependent on the US to go it alone.
- maxglute 7mo agoTBH if US had it's shit together and sorted out refinery mismatch it can coast along as CONUS crude island with WTI prices of $40-60, but that's 7-10 year resolution. On paper if Trump sequenced refinery build out during Trump1, US can afford to toast gulf oil and be relatively insulated vs global prices... well not just insulated but have huge energy price advantage. There was lightcone where US could blow up global energy and be net benefactor, I guess thank god evil is stupid sometimes.
- vasco 7mo agoHe took the easy way and invaded Venezuela for that. Less prep needed, less scruples needed.
- maxglute 7mo agoIt's guaranteed access but I think still paying close to benchmark price (relative sludge tier VZ oil) because Trump likely can't/won't compel Chevron to sell at discount for getting VZ up and running. Ironically if oil still under VZ control, US could have probably pressed PDVSA to sell at discount more than Chevron.
- yread 7mo agoUS is set to double+ its LNG production before 2029 so at least that is covered https://nitter.net/jackprandelli/status/2036210941373591828#m https://nitter.net/jackprandelli/status/2036210941373591828#... EDIT: btw does your username mean you have a big ass?
- tsoukase 7mo agoNot the parent but from a weight training perspective it would mean maximum glute muscle activation.
- maxglute 7mo agoUS LNG already functionally unlimited already. Mismatch is getting heavy/sour crude for diesel etc for us gulf coast where domestic shale crude is light/sweet. Could build expensive refineries in south to fix mismatch, or as someone else noted, invade VZ and bring up to full utilization. yes suppose to be maximize gluteus as squat joke but maxglute for brevity.
- blueflame7 7mo ago[dead]
- HWR_14 7mo agoIs it going to be a GFC style crash where I want my assets in currency denominated investments (e.g. bonds) to buy assets at crazy low values or is it going to be mega-inflation where I want my assets in commodities and stocks?
- danaris 7mo agoAh, HN. "There's likely to be a global recession, driving millions of people to destitution and starvation and thousands to death. How can I profit from this?!!!"
- hypeatei 7mo agoI think it's more protecting ones wealth rather than profit. But sure, I guess only people on HN try to do that.
- scoofy 7mo agoWait, what?!? Nothing about trying to strategically put yourself in an ideal situation during a recession is going to make anyone else worse off. Much of this isn't zero-sum, and assuming the investments are not rent seeking. If I were to invest in potatoes because I thought people might need potatoes, then there should be an incentive to make more potatoes, and if people need potatoes, then more potatoes are likely to exist... which helps people get food. If I instead concern myself with clutching my pearls and tightly as I can, and I don't invest in potatoes, then there is less of an incentive to make more potatoes, fewer people are able to buy the limited supply of potatoes, and everyone is poorer for it.
- Ekaros 7mo agoI am not going to use this strategy but my guess is first the first then the second. Stocks seem to be already on very high levels. Commodities might fare less well as oil is major input. So high prices probably lead to less demand to lower prices or at least combating the cost increases from oil as input.
- jjav 7mo agoI have no idea, so I have short term bonds, and gold, and commodities, to diversify.
- tsoukase 7mo agoThis is a live test that the world is not ready to wean from fossil fuels.
- maximus-decimus 7mo agoOr it will accelerate the switch to evs.
- calcpocket 7mo agoWell, we've lived that period in the corona pandemic when oil prices were skyrocketing, and all the product prices went up and never went back down as most politicians laid as always