Technical analysis for shorts & longs Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Technical analysis for shorts & longs

SPY 671.91

0.0%

Nov 14 4:00 PM EST

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Johnny Canuck who wrote (63985)

6/17/2025 4:06:01 AM

From: Johnny Canuck

Read Replies (1) of 67962

The Oil Price Spike That Wasn’t

Global production is well placed to cope with Iranian disruption.

By
The Editorial Board

June 16, 2025 5:40 pm ET

The US Oil & Refining Company in Tacoma, Washington.
The big news in oil markets since Israel’s attack on Iran’s nuclear program is the price spike that wasn’t. Brent crude popped from $66 a barrel or so to a high of $78 last week, but by Monday it was back below $73. The non-panic owes to ample global supply, and it’s a lesson for Congress and the Trump Administration as they contemplate putting new sanctions on Russian oil exports.
Wars are unpredictable, and an Iranian attack on Saudi oil fields or shutting down the Strait of Hormuz is possible. Iran has made so many self-damaging mistakes leading up to this war that another can’t be ruled out.
But global oil production is in reasonable shape to cope with anything short of catastrophic disruption. Saudi Arabia has been producing more, as have Guyana, Brazil and Canada. U.S. production hit a record 13.5 million barrels a day in March. A sustained price of $70 or above would be welcomed by U.S. frackers, some of which have been taking rigs offline as prices slipped toward $60.
The lesson for President Trump is that oil prices shouldn’t influence strategic decisions about whether to help Israel win its war, or whether to further sanction Russia. President Biden—or whoever made decisions in his White House—resisted tough sanctions on Russian and Iranian oil out of fear that U.S. gasoline prices might rise. Rather than ease its regulatory attack on U.S. producers, the Biden team relaxed sanctions on Iranian oil exports, giving Tehran tens of billions of dollars to finance its nuclear program and proxies.
Meanwhile, with the help of the Chinese and Indians, Russia has evaded a price cap on its oil exports by G-7 countries. The cap restricts ships that are owned or insured by Western companies from transporting Russian crude that sells for more than $60 a barrel. While the cap reduced the price of Russian crude by about $10 a barrel, it hasn’t crimped the Kremlin war machine.
Russia last year exported on average 7.5 million barrels a day, a mere 400,000 less than in 2021. That translates to about $450 million a day in oil revenue at a price of $60 a barrel. China and India have benefited from buying Russian and Iranian crude at somewhat discounted prices and that will continue unless the U.S. tightens sanctions.
Europe and the U.K. want to lower the price cap to $45 a barrel, though this wouldn’t much squeeze the Kremlin since most Russian crude is transported on “shadow tankers” not covered by the cap. A more effective idea is to impose secondary sanctions on countries that buy Russian energy, as a bill championed by South Carolina Sen. Lindsey Graham would do.
The Sanctioning Russia Act of 2025, which has 83 Senate co-sponsors, would impose 500% tariffs on countries that purchase Russian energy if the President finds that Vladimir Putin continues to refuse to negotiate a peace agreement, attack Ukraine or subvert its government. The goal is to ratchet up pressure on China and India to stop buying Russian crude.
Countries that provide military or economic support to Ukraine would get a 270-day tariff exemption. The Trump Administration has resisted backing the bill owing in part to concerns it would increase oil prices. But the market would adjust.
In any event, as Mr. Graham noted Sunday on CBS’s Face the Nation, “you pay now or you pay later. If we get Iran right and we get peace with Russia, Ukraine, not only do oil prices come down, the world will be better off.” America, Ukraine and Israel would be in a better place if the Biden Administration had understood this, but Mr. Trump can learn from his predecessor’s mistakes.

Copyright ©2025 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
Appeared in the June 17, 2025, print edition as 'The Oil Price Spike That Wasn’t'.

Hide Conversation (2)

Conversation3 Comments

By joining the conversation you are accepting our community rules and terms. To view rules, terms and FAQs, click here. Questions can be sent to moderator@wsj.com.

Conversations on news articles and news columns must be kept on the topic of the story. In opinion content, conversations can delve into other subjects. The conversation will close on this article four days after publication.

What do you think?

3 People typing

Sort by
Newest

3 People typing

rp

ron prichard

27 seconds ago

so a nearly 11% rise in prices is nothing to the EB -- if it's under a Republican, I guess.

Reply·

·
Share
LL

L Laj

3 minutes ago

Are you sure about that, EB? Oil still isn't where it was. This "spike" wasn't based on actual, but rather speculative, decreases of availability of a commodity.
(Edited)

Reply·

·
Share
KS

K Sharp

6 minutes ago

Just because oil did not continue to spike today doesn’t mean it won’t spike tomorrow. The war in the Middle East is escalating. Israel is not going to back down as the current regime’s stated mission is to destroy Israel. The dictators running Iran want to keep their power. There is still a high degree of uncertainty.

Reply·

·
Share