Trump declares war against OPEC, Saudis Laugh as Oil Price Surges

Donald Trump rages his assault on oil prices as US commodities hit a 5-month high today. While the US President has so far focused on condemning high energy costs through Twitter, he now seems to be doing more than just carrying OPEC online. As CNBC reported, the US wants to secure "dominance" in this sector through a blockbuster executive order designed to boost pipeline infrastructure. In reality, Trump goes a dangerous move when it comes to crude oil.

Very important that OPEC increases the oil flow. World markets are fragile, the price of oil is too high. Thanks!

̵[ads1]1; Donald J. Trump (@realDonaldTrump) March 28, 2019

Cheap energy is great for farmers, good for trump

The biggest obstacle that Donald Trump faces, to maximize his popularity through The energy policy is that two sides of the base want different things. First, it is Rust Belt's farmers and factory workers who love to see the cost of living reduced. Farmers use a lot of fuel, and any reductions in energy costs are a major benefit to their business. In this regard, Trump can help compensate for some of the damage his trade war has against certain breeding prices.

The other side of this coin is that other red states like Texas and Oklahoma love high energy prices. Historically, Democrats have been rocked over the bullets in these areas to try to reduce the value of crude oil. Trump knocks on tribalism to keep these states aboard, and if polls are any indicator, they are still very much alive.

US Ingenuity – Not Obama or Trump – Has already made Energy & # 39; Dominance & # 39;

Moreover, it is quite strange to see Trump bashing OPEC on high oil prices and wants to restore America's dominance when it is already the largest oil producer in the world. Obama does not deserve credit for this as he previously claimed, but not Trump either. Good old technical ingenuity helped the US access utilize useless deposits.

US crude oil production has trend upwards for years. | Source: FactCheck.org

However, there is another reason why Trump will suppress oil prices and that is the same reason he is attacking the Federal Reserve over cheap money. All that Trump does is try to stimulate the economy. He needs it in exaggeration to get his GDP requirements met. If energy prices are too high for consumers, get defensive. It also erodes wage gains as inflation eats into paycheck.

Janet Yellen once called cheap energy "a tax relief" for the American people, and that is probably true. OPEC is far less diversified in general than the US, so generally cheap oil is a significant negative as opposed to the US, where there is a net benefit to the service-based economy.

Can Trump's oil price war slow down his popularity in Texas?

If the US president succeeds in crushing energy prices, it may be an interesting twist in 2020. Texas has changed blue for a while, and Beto O & # 39; Rourke almost reached Ted Cruz in the last election.

If oil workers are sufficiently irritated, then conceivable, they may rebel in 2020. The flip side of this is that Trump could increase its production base in the "blue wall" of Michigan and Wisconsin, as the economy continues to decline.

That's the usual all-in strategy of Mr. Trump. The last Democrat to take the 38 electoral votes in Texas was Jimmy Carter in 1976.