Reporting and opinion by Mathew Carr
US President Donald Trump wants $50 crude oil, according to the WSJ.
If you are following energy markets, you will probably already know that Mr Trump is saying this now because he knows oil is going to fall, anyway, because of a glut in supply that is building.
He wants credit and praise for the fall, which will be welcomed by hard-pressed American voters and drivers.
OPEC+ is losing its ability to push oil prices higher as demand eases and people around the world shift to electric and hybrid vehicles. Supply remains high.
The glut of sanctioned oil in tankers offshore China and Malaysia has reached almost 82 million barrels, according Kpler/Rigzone. (The world consumes about 100 million barrels a day.) These tankers will allay concern about any shortage from new supply disruptions, say, in Venezuela.
This is partly why Brent crude prices have been struggling to stay above $60 since the middle of December. The struggling comes despite Trump’s Venezuela antics, which have included commandeering multiple oil tankers and an illegal kidnapping of that country’s leader.
A drop to $50 barrel from $60 a barrel would be about 17%.
In my dreams, this fall would give the US “space” to put a price on carbon dioxide emissions from fossil fuel because the increase in costs from the carbon allowances is offset by lower crude prices.
This is an actual plan that’s been pushed by me and the IMF for years…..yet ultimately so far…it’s not been implemented.
The desperation of Mr Trump’s actions in 2026 is not just about the weakening of the oil price and the simultaneous eroding of the petrodollar.
An emergency meeting of oil executives in Washington DC shortly today (Friday) …is probably about trade and climate negotiations … not just oil and Venezuela.
Why do I say this?
Despite his anti-woke rhetoric and derisory statements about the region on the other side of the Atlantic, the US administration is under pressure from Europe, as the EU solidifies a trade deal with big nations in “Trump’s South American hemisphere”.
It isn’t “his hemisphere,” by the way, just because he says it is.
This Mercosur trade tie up, which comes after 25 years or so of negotiations, is outwardly to reduce Europe’s dependence on China and expand Brazil’s market access (for example) … yet Europe also probably wants to trade clean-energy equipment, biofuel and carbon credits / allowances with nations such as Brazil (which is leading climate talks this year at the UN level and has more ambitious climate targets than most countries, so might be a seller of carbon).
Note, how Trump exited from the UNFCCC yesterday, a desperate move that’s probably an ambit claim and part of climate and trade negotiations going on behind the scenes and in semi-open forums such as the WTO, UNFCCC and the G20.
The US has emitted 36 billion more metric tons of GHG than it should have since the Paris climate deal was struck in 2015, according to some analysts.
See this:
Other western countries have failed to cut emissions, too…even though they have been promising emerging nations that they would since the 1990s. Climate damage mounts.
By “winning control” of Venezuela and its oil, Trump can arguably shift emissions to an emerging nation, away from the US….and that raises the question whether the USA will give more respect to the climate-justice deals that he publicly derides.
His rhetoric on Greenland is probably also to do with the trade and climate talks.
Greenland, because of its low population of less than 60,000, has hardly any historic GHG emissions …so it arguably has the ability to emit lots in the future based on climate-justice measures such as the one above …so its future value is enormous in that regard (not just because of its rare-earth minerals).
Not that you would know that about Greenland from the mainstream media, which mostly pretends that global carbon budgets are not at all important…or don’t exist.
Both the EU and the US want Greenland’s unused carbon budget.
Geopolitics is not just about crude oil, “energy dominance” and minerals, even if Trump pretends it is.
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